Decision by Coles, Aldi to lift branded milk prices cautiously welcomed by SA dairy farmers

The move by Coles and Aldi to lift the price of its private label milk has been cautiously welcomed by the struggling SA dairy industry.

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Struggling South Australian dairy farmers have cautiously welcomed Coles and Aldi’s move to increase the cost of their private label milk by 10c a litre.

However farmers say the new price — which brings the chains in line with Woolworths’ 10c a litre increase a month ago — will only restore their financial position of eight years ago.

SA Dairyfarmers’ Association president, and South-East producer, John Hunt was heartened that this week’s supermarkets’ price rise would be passed directly to farmers.

“It’s a step in the right direction,” he said.

Dairy farmers Scott and brother Trent Thorpe on their Kangara family farm with Friesian dairy cattle. Picture: Tricia Watkinson

But Mr Hunt said, in real terms, the price rise only moved farmers to a similar position to where they were in 2011 when the milk price war began.

Since then, more than 20 per cent of SA dairy farmers having exited the industry, and nationally more than 1000 farmers have ceased their dairy operations.

“We’ve had to deal with $1 a litre milk since 2011 and in today’s money that $1 a litre milk is now worth 89c a litre,” Mr Hunt said. “The change by the supermarkets really only returns us to the same price we were at in 2011.”

Adding to the pressure, Mr Hunt said dairy farmers’ cost of doing business had risen by 25 per cent in the past three years and there was not likely to be any relief from this in the near future.

He is hoping support for the dairy industry keeps growing.

“One of the key things now is consumers continuing to support local producers,” he said.

“We’d love to see the good sentiments towards the dairy industry continuing.”

Dairy farmer Trent Thorpe was one of the farmers that benefited from Woolworth’s milk price rise a month ago.

He is part of a family farming operation that includes a 300 acre dairy at Clarendon, running 150 Holstein/Friesians, and a beef operation near Peake.

The family supplies into Woolworths branded milk through dairy processor Parmalat. “The 10c a litre price rise has helped, but then grain and hay prices have also gone up this past year, with the way the season went,” Mr Thorpe said.