Dairy

Dairy levy floated

By Country News

Support is growing for a temporary 10¢/litre levy on milk to support drought-affected dairy farmers, as a groundswell of community support for the measure has forced politicians and supermarkets to consider the idea.

Yet despite many welcoming the action as a step forward, others are saying the measure does little to fix the key problems with the industry.

An online petition started by Queensland Dairyfarmers’ Organisation last Monday has collected more that 65000 signatures, prompting Federal Agriculture Minister David Littleproud to throw his support behind the proposal.

If implemented, the levy would see consumers temporarily pay an additional 10¢/litre at the checkout, with processors tasked with ensuring the full levy is passed on to dairy farmers.

‘‘We all know many of our farmers are really struggling right now,’’ Mr Littleproud said.

‘‘The fact is $1 milk has devalued the milk category in the eyes of consumers by making it cheaper than water.’’

Despite conversations with Coles, Woolworths and intentions to engage Aldi and IGA’s owner Metcash, Mr Littleproud must still win over cabinet, with Prime Minister Scott Morrison already stating he’s not interested in fixing the problem with a tax.

Concerns have been raised regarding the cost to household budgets and the logistics of ensuring farmers receive the full benefit.

‘‘Consumers have huge power here. All those who are outraged on social media would do more for Aussie farmers by paying a 10¢ levy than they do by sharing a video on Facebook,’’ Mr Littleproud said.

However, UDV president Adam Jenkins knocked down the idea of a levy, saying the best thing that could be done was creating a prosperous dairy industry.

‘‘We don’t support taxes and levies — they’re a short-term Band-Aid,’’ he said.

‘‘The long-term, sustainable solution is to remove $1/litre milk ... we’d prefer to allow farms to be profitable with the product they have.’’

NSW Farmers’ dairy committee chair Erika Chesworth said the decision to discount dairy products had deteriorated farmers’ economic resilience, and she called for an end to discounted goods.

‘‘When farmers are paid fairly they build resilient businesses and plan for ways to deal with dry years. Farmers have been under pressure for years and simply have not had the financial resources to prepare,’’ she said.

Woolworths said it would continue to work productively with the Federal Government regarding a potential 10¢/litre levy and was expecting to see a policy proposal soon.

‘‘We maintain our view that a holistic solution involving industry and government is needed to drive meaningful and long-term reform in the sector,’’ the statement said.

‘‘The recent recommendations from the exhaustive 18-month inquiry by the ACCC clearly need to form an important part of the policy discussion.’’

Coles said it shared concerns of the plight of rural communities and farmers across all sectors but believed the ‘‘most effective way’’ it could assist farmers was by collecting and matching donations at the checkout.