The code has been pushed six months ahead of schedule, to start in January 2020, which Federal Agriculture Minister Bridget McKenzie said was a result of advocacy from her National Party.
“We are keen to make sure that all of industry has an opportunity to provide final comment on the drafted mandatory code because dairy farming is quite a different enterprise in Western Australia compared with Victoria — and that goes for all the states,” Senator McKenzie said.
The code of conduct will aim to provide an increased level of transparency in dealings between processors and farmers.
One Nation's Pauline Hanson placed public pressure on moving the date forward but Senator McKenzie said it didn't impact the decision to alter the date.
NSW Farmers Dairy Committee chair Colin Thompson said the mandatory code was a result of the government wanting to assist farmers during challenging times.
“Personally I don’t see any benefit in it being brought forward, so to introduce it mid-way through a contract period is odd,” Mr Thompson said.
Queensland Dairyfarmers’ Organisation president Brian Tessmann said the code would make it difficult for farmers to switch processors.
“Some contracts are on a calendar year basis and some are on financial year basis, which can create a limbo for farmers,” Mr Tessmann said.
“Farmers in Queensland sign contracts for up to five years but prices aren’t stated for over one year.”
The mandatory code will introduce a resolution process and UDV president Paul Mumford said it would have a cost for the public service to run.
“At some point the cost on the processing side will eventually be borne out in milk price for farmers,” Mr Mumford said.
“I really want to emphasise farmers’ feedback into the final document to make sure it’s fit for Victorian farmers within their businesses.”
Key points of the code include:
¦ Milk supply agreements must have written records of supply and price from a set date and be published on processors’ websites.
¦ Milk supply agreements must not provide for exclusive supply, tier pricing and withholding loyalty payments.
¦ Price step downs will be prevented.
¦ A cooling-off period for milk supply agreements will apply.¦ A dispute resolution process will be implemented.
¦ Breaches of the code will be investigated by the Australian Competition and Consumer Commission.
The mandatory code was an outcome of the April 2018 Australian Competition and Consumer Commission’s report into the dairy sector.
The first round of consultations started on October 31, 2018 and the second on January 15, 2019.
For more information and to provide feedback on the code, go to: https://haveyoursay.agriculture.gov.au/
