Farmers could get a mandated minimum price for milk, with Labor promising to investigate the move if the party wins the next federal election.
Labor wants the Australian Competition and Consumer Commission (ACCC) to test how a minimum farm gate milk price would work to protect the dairy industry.
The announcement comes after Woolworths announced plans to raise the price of it's $1-a-litre milk to $1.10-a-litre. Coles and Aldi said they would not follow suit.
"It is not acceptable for our farmers to be paid less than the cost of producing their milk," Labor agriculture spokesman Joel Fitzgibbon said on Wednesday.
"If a floor price is needed to end this crisis, that's what Labor will deliver."
Australian Dairy Farmers have called for more detail about the proposal.
See next week's Country News for more.