Dairy Connect Newsletter - A Moment with Morgan

By Shaughn Morgan - Dairy Connect

Recent months have brought uncertainty for Australian agriculture and the economy generally.  

The advent of COVID-19 has become the burden on the top of a rather difficult few years for the Australian dairy industry. This is coupled with the ongoing devastating drought, the recent bushfires as well as high input costs underscores the difficulties that are being confronted by small farming enterprises everywhere.

In NSW and Queensland, the most recent milk production figures illustrate the challenges that producers are continuing to confront:

State Month Litres (‘000) Year-to-date

NSW -2.7% -2,150 -4.9%

VIC 10.9% 36,734 -0.3%

QLD -19% -5,034 -13.1%

SA 2.1% 826 -3.2%

WA -3.2% -965 -3.8%

TAS 11% 7,788 4.8%

What are the viable options for the northern states to ensure a sustainable dairy industry?

We have seen the continued difficulty in NSW of two bodies trying to represent dairy farmers and in the case of Dairy Connect, the dairy value chain.

It is always difficult to overcome vested interests, but to ensure the long-term viability of the industry, it is necessary to do so.

The coming months will determine how best that this can be achieved but given that this has been an ongoing dialogue dating back to the formation of Dairy Connect in 2011, it continues to require a strong will and a firm desire to ensure a positive outcome for all.

As Dairy Connect said in relation to the Australian dairy plan discussions, everything must to be on the table and nothing should be discounted.

Most recently, the Australian dairy plan committee chair has announced the formation of an ‘organisational reform steering committee’ intended to ‘oversee the development of reform options, ensure strong industry engagement and an appropriate vote to create a reformed industry structure’. While I do not question the good intent of those participating in this continuing inquiry, I would have thought that reform options should have been well and truly settled by now. Given that they are not, stakeholders are still to face months of consultation and engagement. These are months that some dairy farmers simply will not have. You can read the most recent communiqué from the Australian dairy plan committee at http://go.pardot.com/webmail/99032/418675467/b950ae92f5ee9c1cdeb58b0b407336206d2f9f73bb7f3e945af8e01bcde222fb

More recently, Federal Agriculture Minister David Littleproud called on the supermarket chains to impose a further voluntary levy on consumer milk. Unfortunately, this has not had much success in the past and it is unlikely to have success now.

We need to ensure that there is a win/win in the dairy supply chain for all participants however without suppliers there will be no processors or customer dairy products at the supermarket. The supermarkets need to unpin their social licence to operate and this can be enhanced by ensuring a fair and equitable farm gate price for the fresh nutritious milk that they sell.

Dairy Connect will continue to advocate strongly for a farm gate price that is above the cost of production and that is fair for all dairy farmers. There are two Parliamentary inquiries underway, one in the Senate and the other in the New South Wales Parliament. We will be appearing before both and we will be presenting cogent policy positions that can be undertaken by both the State and federal governments to ensure the ongoing success of pasture fed dairy farms.

We must give a big shout out to NSW Ministers Barilaro and Marshall for the recent announcement of the $140 million bushfire industry recovery package ‘to support the short-term recovery and resilience of the forestry, horticulture, agriculture and aquaculture industries in NSW impacted by the bushfires from 31 August 2019’. We are grateful for the support and it acknowledges the overwhelming devastation that the bushfires had upon rural and regional communities in late 2019 and early 2020. Further information may be found that https://www.nsw.gov.au/regional-nsw/bushfire-industry-recovery-package 

As I conclude my thoughts and the issues that have been confronting the dairy industry since my appointment as chief executive back in March 2016, I continue to maintain high hopes of finding a way forward in the myriad of issues that we confront daily, weekly and yearly. I remain buoyant given the strong, on-going support of communities in metropolitan areas and regional hubs. We must find ways to continue to garner this support and ensure that we never offend vital audiences.

In my most recent media release, I highlighted the importance of the 20th anniversary of the United Nations World Milk Day. As the release states:

•  Australian dairy is a $13 billion annual farm, manufacturing and export industry.
• With a farmgate value of $4 billion annually, the Australian dairy industry supports and enriches regional Australian communities.
• More than 6,000 Australian dairy farms produce around 9.7 billion litres of fresh creamy milk a year.
• The industry directly employs nearly 40,000 Australians on farms and in factories, while more than 100,000 Australians are indirectly employed in linked service industries.

 The dairy sector touches the lives of approximately one billion people around the world.

•  121 million dairy farms support a long tradition of milk production for processors and selling milk direct to customers.
• 600 million people live on dairy farms, caring responsibly for their cows and making the land better for the next generation.
•  400 million additional people are supported by the full-time jobs that are created in support of dairy farming such as feed and fertilising companies, milk collection, processing and retail.

What a powerhouse. We must ensure that this is not lost.

1 June not only sees this important world milk day being celebrated but will also witness, for the first time, template milk supply agreements written in plain English, with fair and equitable clauses and with the minimum price clearly stipulated being accessible to read by all on the websites of processors and those who are the first suppliers of milk.

There are still many trials to go with the introduction of the mandatory code for dairy but these first steps will begin the restoration of trust, transparency and fairness in discussions between those who supply nutritious fresh milk and those who purchase it. This is an important step albeit only a first step to ensure a fair farm gate price for all dairy farmers. We still have much to do.

Lastly, those who are our members will be receiving their renewal notices by email or mail in the coming days. Organisations such as Dairy Connect are only as strong as those who are willing to join the battle. Our achievements are many and we will continue, for as long as we are able, to advocate and lobby on your behalf. I ask that you continue to be a member of our dairy organisation and that you encourage your friends and colleagues to join as well. This is about belonging and I call on you to belong to your dairy organisation.

You may view the video where I talk about the importance of membership and being a part of a bigger whole here.

Until next we speak, yours in dairy

Shaughn

https://www.dairyconnect.org.au/