eastAUSmilk boss takes aim at Australian Dairy Products Federation

With little change in the farmgate this season, eastAUSmilk chief Eric Danzi says the processors need greater scrutiny.

Australia’s dairy farmers are being short-changed by processors, eastAUSmilk chief executive Eric Danzi says, claiming the farmgate price should be “at least $10 a kilo milk solids”.

Hovering around $8.20-$8.30 per kilo milk solids in southeastern Australia, Mr Danzi said the current farmgate offerings barely covered the cost of production.

The eastAUSmilk chief took aim at the Australian Dairy Products Federation, saying they had run an “extremely effective campaign” to drive prices down to unsustainable levels for farmers.

“The farmgate prices on offer this season are all about one thing: the desire by processors to recoup profits from farmers,” Mr Danzi told The Weekly Times.

“They were screaming from the rooftops last season about the farmgate price — they pointed out the international dairy prices and the Australian dollar.

“Well, guess what? International dairy prices are stronger now, the Australian dollar is weaker.

“With the current market conditions, dairy farmers should be getting at least $10 a kilo milk solids but the processors are keen to keep that story quiet.”

With a new review of the mandatory dairy code of conduct under consideration in Canberra, Mr Danzi said the ADPF needed “to be precluded from influencing milk price as clearly occurred last year”.

“Reviewing the code gives us an opportunity to not repeat the same mistakes as this season,” he said. “Individual processors should not be allowed to send price signals, given that’s what happened prior to June 1.

“The role of institutions, with major processor clients, in sending price signals must also be reviewed.”

Eastausmilk chief executive Eric Danzi. Photo Steve Pohlner

ADPF chief executive Janine Waller said the federation did not comment on specific farmgate pricing strategies or step-ups.

“These decisions lie with individual dairy processing companies aligned with market conditions and their business model,” she said.

“For transparent and trusted information on the current factors that can influence the value of raw milk across Australia, visit the industry’s Milk Value Portal and the latest quarterly Dairy Market Insights Report.”