The annual Northern Dairy Industry Situation and Outlook business breakfast forum  today (14 June, 2012) at the Brisbane Convention and Exhibition Centre has heard that the supermarket retail milk ‘price war’ is continuing to harm Queensland dairy farmers. This is despite the fact that Coles has contractual arrangements to buy its homebrand milk from Malanda in the Atherton Tablelands in northern Queensland.

At the forum, Queensland Dairyfarmers’ Organisation (QDO) President Brian Tessmann shared results from a QDO survey of dairyfarmers across Queensland, conducted in May 2012. The survey showed that farm confidence had dropped dramatically due to the milk war, which had led to cuts in farm gate prices.

“With these cuts many farmers in Queensland will make a loss this year. Since the supermarket price war started Queensland has lost over 40 dairy farmers. This needs to stop,” Mr Tessmann said.

He said that his industry wanted the whole milk supply chain needs to be encompassed by a mandatory code of conduct that could ensure fairness in the value chain from major supermarkets to processors and right back to the farmers’ farm-gate prices.

Mr Tessmann said the issue still needed urgent attention and action from the Federal Government. “This is having a serious impact on farmers today, and in the future will also impact consumers by eroding the ability of Queensland to supply fresh milk for itself.” He said he also backed food industry calls for the introduction of an ombudsman to tackle unfair practices in the value chain, as well as a code of conduct.

Mr Tessman’s call for a mandatory code of conduct supports the Australian Food and Grocery Council’s proposed draft legislation for the establishment of a  supermarket ombudsman and comes on the heels of Master Grocers Australia urging the ACCC to exercise its powers to rein in the market dominance of supermarket giants Woolworths and Coles.

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