How Aussie dairy farmers are keeping their product local

For Andrew Koch it’s all about pride in his produce.

Brought to you by Woolworths

When the third-generation dairy farmer from South Australia’s Barossa Valley joined a supply agreement for Woolworths Farmers’ Own milk in 2015, he did so partly to have confidence in knowing where his milk would end up.

“For us it was just really nice – and it sounds simplistic – but it was really nice just to know where your milk was going,” he said.

“We had gone through quite a period of supplying different milk companies, where the milk was going into different pools here in South Australia. You had no idea where your milk was going from one day to the next.

“Now, to know that our milk is going into a specific product is really satisfying. It’s important to the farmer. It’s about pride.”

Woolworths’ Farmers’ Own milk has been a game-changer for its dairy farming suppliers across Australia.

The producers, who are based across Australia, are paid a premium for their milk under longer-term contracts that can provide greater business confidence for ongoing operations. They create a quality product.

The premium brand has been awarded, among others, a gold medal at the 2014 Royal Melbourne Fine Food Awards, a gold and silver medal at the 2016 DIIA - Dairy Industry Association of Australia Show, and last year’s Canstar Blue award for the most satisfied customers for fresh milk.

And consumers benefit from the pure milk blend from a discrete local region.

“It’s got a creamier texture to it, it’s like going back to the good old days when milk was delivered in a bottle to your door,” Mr Koch said of their non-homogenised products.

The brand started seven years ago when seven farmers from New South Wales’ Manning Valley, about an hour from Port Macquarie, negotiated with Woolworths to do a deal.

Adrian Drury was one of the founding farmers involved in the original plan.

Amid structural changes challenging the industry at the time, the Manning Valley dairy producers struck a deal to sell to Woolworths directly instead of going through a processing intermediary.

“It was a good situation for both of us,” Mr Drury said. “We tried to get a price that was fair for us. It was a circuit-breaker. We were the first, we broke that traditional mould.”

Initially the Farmers’ Own brand was stocked in eight local shops in the region and a dozen in Sydney, before its success meant the business model was rolled out across the Australian mainland.

The range is now stocked in supermarkets around the country. Each state has their own milk sourced from their own local suppliers.

The bottle feature the faces of famers in different states.

Woolworths Dairy Category Manager, Denise Cotter says, "We're proud to partner directly with dairy farmers to deliver our customers a high-quality product in our Farmers' Own milk.

“The long-term relationships we’re fostering with our Farmers’ Own suppliers are incredibly valuable to us and ensure the farmers receive a premium price for their milk. The range also offers certainty for our customers, who can pick up a bottle of Farmers' Own knowing it's milked and bottled in their own state, supporting local dairy farmers."

These direct arrangements have meant more security and terms for the farmers, and this has meant they have been able to invest in their farms.

Mr Drury has made a major outlay in a robotic milking machine for their 400-strong herd. “It has meant our cows can come in at their leisure, so to speak,” he said.

“The cows turn up and they choose to come into the machine, then the machine will attach to the cow. You don’t have to be here all the time.” He also said maintaining the integrity and quality of his milk was an important factor in choosing to do business with Woolworths directly.

“We certainly have a pretty high standard for our milk and we focus on the taste of that milk,” he said. “Farmers’ Own is basically how it comes off our farm."

In southwest Victoria, Colac dairy farmer Philip Cobbledick was one of the original Victorian farmers who signed up in his state. He says the agreement is mutually beneficial, with Woolworths able to offer a premium product and producers gaining better contract conditions.

“We’ve supplied milk for nearly all our lives, always no trouble meeting the high standards of premium quality milk,” he says. “It was a no-brainer from our point of view when Woolworths was looking at going into that [premium] area.”

The third-generation farmer says security for their business has allowed them to expand their herd to about 700 cows and purchase more land for pasture. It is also paving the way for another generation of dairy farmers to stay in the business.

“One of my grandsons has just started an apprenticeship on the farm, so he will be fifth generation,” he says. “It has been in the family for over 120 years. He was born to farm.”

Farmers’ Own is stocked exclusively in Woolworths supermarkets around the country. Each state has its own milk sourced from local dairy farmers. Find out more here.