Dairy

Support for milk price restructure

By Rodney Woods

The UDV says proposed changes to the milk price structure need to better represent the market value of fat and protein.

UDV president Adam Jenkins said the group had been pushing for this for a while.

‘‘From last year’s conference we asked processors to be more in line with the market,’’ Mr Jenkins said.

‘‘We have been advocating for a long time that we need to change the structure.

‘‘If you look at it as is, protein pricing is much higher than what is on the market. We need more alignment.’’

Mr Jenkins agreed with Jersey Australia that the current system was outdated.

‘‘It is ridiculous. There are 32 different levels of pricing structures. It’s too complex,’’ he said.

‘‘We’ve outsmarted ourselves to the point where we are paying a price to actually produce profitable milk.

‘‘Is the milk volume going up or down? It’s clearly going down. To grow milk volume, farmers need to be profitable.

‘‘You wouldn’t plant wheat in the summer and expect a return, so pricing needs to reflect the comparative advantage that Australia has.’’

Mr Jenkins said a whole industry approach was needed to get a simpler pricing structure.

‘‘We need industry to show leadership and we will be having more conversations around tackling pricing structures this year,’’ he said.