Chair of the NSW Farmers Dairy Committee Erika Chesworth said farmers are perplexed by the interaction between the value of certain dairy products and the prices farmers receive.
“For farmers, the dairy supply chain lacks logic – currently we see an increase in the global dairy price but this is not reflected in the price of Australian products or the price back to farmers in NSW,” Ms Chesworth said.
“Currently there are imported products in supermarkets that reflect the international price. However similar Australian products, such as butter and block cheese, are available for a reduced value and not reflecting the international market”.
“We are concerned that this disparity is due to retail discounting on Australian products and this damages the long- term sustainability of the industry”.
“Dairy farmers need clarity on the reason for this difference and to ensure that the flow of value within the dairy supply chain is sustainable.”
“Greater communication and transparency between the production, processing and retail would enable stronger trust and cooperation within the industry. It is vital that all sectors with the chain are working for the long term sustainability of the industry”.
NSW Farmers’ are also hopeful that the ACCC’s inquiry into the dairy industry will provide insights and information on the distribution of value within the industry.
“We eagerly await the ACCC’s interim report as an indication of their investigation into the dairy industry supply chain. The recommendations need to provide solutions to reducing the mystery in this supply chain and enable industry to undertake actions to support the long term future of the industry.”
The interim report for the ACCC inquiry into the dairy industry is due to be released 30 November 2017.