National advocacy body Australian Dairy Farmers has renewed calls for supermarkets to increase the retail price of discount milk to $1.50 a litre, with the extra money going back to farmers.
ADF chief executive David Inall said supermarkets needed to support the dairy industry, which was coping with the impacts of drought, bushfires and high production costs.
“The price farmers pay for energy, and water and fodder for their cows, remains high — but the retail price for their milk has stayed stubbornly low for almost a decade,” he said.
Last year, major retailers, led by Woolworths and Coles, increased the price of their private label milk brands from $1/litre to $1.10/litre.
“We lost nearly 500 dairy farms in one year between 2017-18 and 2018-19 and since 2011, we have lost more than 1500,” Mr Inall said.
“Since 2011, the average profit for a dairy farm in Australia has been $41 553 per annum.
“If we are to stop farm exits and hardship, then retailers need to increase the price of their store brand retail fresh milk to $1.50 per litre with the increase going back to farmers via their processors.”
Last week, Federal Agriculture Minister David Littleproud pushed for supermarkets to voluntarily extend and expand the temporary 10¢ milk levy.
Mr Littleproud said if Australia continued to lose dairy farmers, the national milk supply would be at risk.
“I don't want to see Australians get to a point where we're importing fresh milk, to a point where we have to rely on another nation to supply that,” he said.
NSW Farmers dairy committee chair Colin Thompson agreed with Mr Littleproud and said retailers and processors needed to do the right thing.
“Low retail prices have decreased profits along the supply chain, and after processors take a cut, farmers can be left with very little,” Mr Thompson said.
“We need processors to do their bit and ensure profit margins are being passed on to farmers.”