UDV president Bernie Free said the price completely misses the mark and will consequently leave some farmers questioning their future.
“This price simply doesn’t reflect the reality on the ground,” Mr Free said.
“Farmers are facing record input costs, water shortages, failed pasture growth, and another year of intense financial pressure.
“An opening of $8.60 won’t cut it for many businesses trying to stay viable.”
The UDV has been actively working with industry, government, and service providers to monitor the impact of the ongoing drought, particularly in the south-west, where a second failed autumn break and lack of rainfall have left paddocks bare and farms under severe stress.
“We’ve got farmers being forced to de-stock and taking on more debt just to keep operations running. It’s putting a real strain on their mental health,” Mr Free said.
“Processors need to recognise that an aggressive cost-of-production environment demands a stronger pricing commitment.”
While acknowledging Fonterra’s efforts to provide early price certainty, the UDV is calling on all processors to review their opening prices with urgency and ensure that they reflect both global market conditions and local seasonal adversity.
“This is not a normal year,” Mr Free said.
“The cost base has shifted dramatically and $8.60 does not provide the margin needed to justify continued investment or ensure on-farm resilience.”
The UDV says it will continue to advocate for pricing that reflects the true cost of production and supports farmer confidence through volatile seasons.
Under the Dairy Code of Conduct, enforced by the Australian Competition and Consumer Commission, any dairy processor intending to purchase milk in the next financial year must publish their milk supply agreements on their website before 2pm on June 1.
Because June 1 falls on a Sunday this year, the deadline is 2pm on Monday, June 2.
