Dairy farmers slam inquiry

Brian Tessmann said the ACCC Inquiry did not adequately address the impact of $1/litre pricing on dairy farmers.
Brian Tessmann said the ACCC Inquiry did not adequately address the impact of $1/litre pricing on dairy farmers. Michael Nolan

AN INQUIRY into Australia's dairy industry has been criticised for failing to acknowledge the issues in the industry.

The Australian Competition and Consumer Commission's interim report, which conducted meetings with major stakeholders including milk suppliers and industry representatives, found farmers faced an imbalance in bargaining power but noted that milk prices would have little bearing on how much a farmer made.

Queensland Dairyfarmers' Organisation president Brian Tessmann said the report lacked direction and intent to fix the threat to dairy farmer interests.

"While the report acknowledges the major issue affecting our industry, the fact that farmers are carrying the overwhelming burden of risk in the supply chain, it offers nothing in the way of solutions or recommendations to fix it,” Mr Tessmann said.

"It is clear that the original intent of the report has been lost on the ACCC, with the interim report failing to address the systemic market failures crippling the viability of

the Queensland dairy industry.”

According to QDO, since the major supermarkets shifted to $1/litre milk in 2011, more than $200million dollars a year has been stripped out of the Queensland dairy supply chain.

This has resulted in more than 180 dairy farmers leaving the industry.

The ACCC report declared a mandatory code of conduct as a possible solution to address the imbalance of bargaining power affecting dairy farmers, which Mr Tessmann supported.

"QDO welcome the recommendation for a mandatory Dairy Code of Conduct, however, this will not directly address the biggest issue in Queensland, the impact retail prices are having on farm gate earnings,” he said.

Federal member for Flynn Ken O'Dowd also supported the call for a mandatory code of conduct.

"The current dairy pricing system is completely outdated and favours the large, dominant supermarkets with farmers forced to carry the risk in the current supply chain,” he said.

"What our dairy farmers need are solutions.”

Topics:  accc inquiry brian tessmann dairy industry ken o'dowd queensland dairyfarmers organisation

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