Dairy farmers milked by the big supermarkets
By AMANDA SPROULE AS A Bexhill dairy farmer for over 30 years, David Wilson has seen plenty of change in the local dairy industry.
However, the loss of many farmers from the local dairy industry shows the pressure farmers like Mr Wilson are under, mainly due to low financial returns in a competitive industry.
According to Col Griffiths, local dairy cattle officer for the NSW Department of Primary Industries, since July, 2000, 107 farmers have left the industry mainly because ‘the returns are just not there’.
Mr Wilson agrees with this, saying ‘the big, bad world of economics’ is having an adverse effect on farmers.
“We’re being told there is no milk shortage by some processors, and economic power has shifted from farmers to supermarkets since deregulation,” he said.
“Farming is a high-risk business and it’s a shame prices mean our hard effort isn’t being rewarded.”
However, despite the number of farmers leaving the dairy industry, Mr Griffiths said milk production hadn’t seen the same proportional decrease.
“In July, 2000, there were 201 suppliers, but now there are about 94 producers supplying milk to four processors.
But the farmers have been very resilient, so we haven’t lost that much production,” he said.
Milk prices rose slightly last year, with milk averaging 37.9 cents/litre, according to Mr Griffiths. But since the cost of grain and fertiliser also rose significantly in the same period, farmers are still struggling.
Despite this, Mr Wilson said continuing to raise milk prices ‘won’t fix the problems’. “We need to encourage young people on to the land, and also change our farming practices and boost productivity,” he said.
Mr Griffiths acknowledges that enticing young farmers is a challenge. “One of the biggest problems facing the industry is the cost of land, which is prohibitive to young people,” he said.