Bulla announces 2022-23 opening prices for suppliers

Bulla is the first out of the opening price starting gates as processors start to chase new suppliers in 2022-23.

Bulla is the first processor out of the 2022-23 starting blocks, revealing an opening price of $7.40 to $8.00 per kilo milk solids to kick off the new season.

In one of the earliest opening price announcements in living memory, Bulla’s dairy general manager Rohan Davies confirmed four opening price figures as the scramble for supply becomes ever more competitive.

The Colac-based processor last year opened with a $6.40 to $6.90 a kilo milk solids range in mid-April, setting off a bidding frenzy from bigger processors such as Saputo, Fonterra and Bega as well as smaller players.

Mr Davies told The Weekly Times that announcing the opening price in March gave suppliers greater certainty in planning their financial year ahead.

“Our farmers have really appreciated that we lead on announcing our milk pricing. Last year, it was in mid-April, this year it is in mid-March,” he said.

“The current economic climate is pretty volatile, we understand that. So we wanted to come out with our prices as soon as we could and the response to doing that last year was overwhelmingly positive.”

“We take a simple approach to pricing such as the flat payment model. Plus, we do not have a stop charge, or a volume charge or a milk collection fee.”

Bulla’s suppliers are divided into four bands, based on consistency of supply.

Band 0 suppliers will receive an opening price of $8.00 a kilo milk solids, with Band 1 suppliers at $7.80 a kilo milk solids; Band 2 at $7.60 and Band 3 at $7.40.

“Because demand for our products is consistent year-round, Band 0 suppliers are those that maintain a pretty consistent level of supply throughout the season — and the bands reflect consistency among other measures,” Mr Davies said.

United Dairyfarmers of Victoria president Paul Mumford congratulated Bulla on outlining their pricing in March, giving farmers ample time to plan for next financial year.

He said the $7.40-$8.00 per kilo milk solids pricing was not just an indicator for the coming financial year but gave processors a good yardstick for pricing in the current season.

“Bulla really ought to be applauded for putting out their prices so early,” Mr Mumford said.

“One of the great frustrations in the past for dairy farmers was that processors would wait until days before the season before putting out prices. Obviously, the mandatory code of conduct changed that, as well as challenges with supply.

“Now the ball is in the court of other processors, not only to outline their prices for the next season, but to readjust their pricing as we travel in the next few months through the current season.”