Coles, Aldi face boycott call from agriculture minister David Littleproud over milk prices

Agriculture minister calls for boycott of cheap milk from Coles and Aldi after they declined to dump $1 per litre pricing.

Agriculture Minister David Littleproud has lashed Coles and Aldi for not doing more to help farmers. Picture: AAP

The federal Agriculture Minister has taken aim at Coles and Aldi for keeping their cut-price milk lines and urged customers to boycott them.

David Littleproud has accused Coles of “pretending” to be a decent corporate citizen and Aldi of “hiding under the stairs” after they failed to follow Woolworths and help dairy farmers by no longer selling milk at $1 a litre.

He said dairy farmers struggling with drought needed an end to the “$1 milk disaster”, a price war that began eight years ago and has been blamed for sending some farmers to the wall.

“Publicity stunts like asking shoppers to donate at the counter to help struggling farmers are just a smokescreen to hide the fact they pay bugger all for milk,” he said in a statement.

“The farmers wouldn’t need donations from the public if Coles and Aldi paid fair prices. Publicity stunts won’t change that. The big German needs to come out from hiding under the stairs and face the Australian public.

“I encourage farmers to get out there in their local paper, radio or TV station and call this arrogant behaviour out. The Australian public deserves to know the truth.

“I also encourage Wesfarmers’ shareholders to contact Coles and let them know they don’t want to continue this approach of hurting farmers in private while handing them small donations in public when the cameras are on.”

Coles yesterday said it was not planning to follow Woolworths in axing its $1-a-litre Coles-branded milk, citing cost-of-living pressures on customers.

It said it would look for other ways to help farmers, including collecting customer donations it would match dollar for dollar from next week. It also said it had committed $16 million over the past six months to support dairy farmers, and promised to continue liaising with the industry and the Australian Competition & Consumer Commission on future initiatives.

“We are one of the main supporter of farmers ... but it is important we don’t disadvantage Coles’s customers,” Coles chief executive Steven Cain said.

“All milk brands should be covered and all retailers should participate [in lifting prices]. If that happens, we’d be very happy to participate in that scheme.”

The ministerial attack came as Coles reported its first profit figures since being spun out by Wesfarmers. Coles Group reported a net profit of $738m for the half year to December, reflecting lower earnings from its convenience-store business and costs tied to the spin-off as an independent company.

Aldi said low prices were a core promise to its customers and gave no indication that its pricing policy would change.

It said it sourced its milk from processors, not farmers, and it expected processors to pay primary producers a sustainable price.

“Aldi can best support the long-term sustainability of the dairy industry by accepting price increases from milk processors that reflect difficult market conditions, thereby facilitating its milk processors to pay sustainable prices to dairy farmers,” managing director Oliver Bongardt said.

Woolworths stopped selling its home-brand milk at $1 a litre yesterday, lifting the price by 10c with the extra money to go to farmers.

Farmers also joined the call to end the sale of $1-a-litre milk.

“It devalues the high-quality product we’re supplying and has never reflected the true cost of production,” Victorian dairy farmer John Keely said.

“Woolworths’ decision is overdue and we thank Woolies, but dollar-a-litre milk never should have existed in the first place.”

Additional reporting: AAP