Australian Dairy Levy Poll result: Voters say no to levy hike

Will milk processors now come to the table after this week’s dairy levy defeat? One big player is making encouraging noises.

An overwhelming majority of dairy farmers have voted against any increase in the levy they pay their peak research and development corporation – Dairy Australia.

More than 72 per cent of valid voters voted to keep the levy at its current level, with about 16 per cent of voters opting for the recommended 20 per cent increase.

Dairy Levy Poll - Overall result

The levy has remained at the same rate since 2012, with farmers paying 2.8683 cents per kilogram of milk fat and 6.9914 cents per kilogram of protein.

A 20 per cent rise was recommended by the Levy Poll Advisory Committee (LPAC) earlier this year but the low to negligible contribution by processors has generated controversy.

In the end the Australian Dairy Farmers Board urged the nation's 5000 farmers not support any increase in the levy, given dairy processing giants – such as Fonterra, Bega and Saputo – refused to contribute, despite enjoying the benefits of the R&D body’s $10 million investment in post farmgate manufacturing research, market access and development.

Dairy Australia managing director David Nation said: “we value and appreciate every dollar of the dairy levy, and we will continue to invest it in ways that deliver tangible benefits to farmers.

“It was also pleasing to see 36 per cent (of primary voters were cast) for an increase in levy, indicating support for the key areas identified for continuing investment – labour, regional services, climate and policy development.

“We will need to consider how we address these key areas and now work to prioritise investment and services with these areas in mind, along with our current investment mix.”

Dairy farmers were denied the right to vote for a cut in the levy rate in the poll.

In February, United Dairyfarmers of Victoria president Paul Mumford gave “an ultimatum to dairy processors to stump up or piss off” – out of Dairy Australia.

Yesterday, Fonterra Australia managing director René Dedoncker said his organisation was willing to make a proportionate financial contribution to DA.

“Fonterra recognises the value of processors and farmers working together and the mutually beneficial outcomes that can be achieved by doing so,” he said.

“We support the notion of processors making meaningful contributions – both financial and time – to ensure that Dairy Australia has the resources it needs to address the industry’s priority areas, and we commit to making proportionate financial contributions.”

Dairy Levy Poll result – by state