June deadline looms for dairy processors

An important reform for the dairy industry will be put under the spotlight next week.

From 1 June dairy processors will be required to have published their supply agreements with farmers under new requirements created by the Dairy Industry Code of Conduct.

The code of conduct, which came into effect in January this year, is designed to help equalise power discrepancies between dairy farmers and processors.

Chair of the NSW Farmers Dairy Committee Colin Thompson says June will be critical for gauging whether the new code of conduct provides transparency for dairy farmers.

“From 1 June, farmers should be able to see the different farmgate prices being offered by the processors. Farmers will be able to compare prices and make an informed decision.” Mr Thompson says.

“The code should lead to clear and simple supply agreements, especially where pricing is concerned.”

“Farmers should check there is a clear dispute resolution framework outlined in their supply contract. There are also dispute management resources available to them, like the Small Business Ombudsman.”

“Australian Dairy Farmers has developed a standard form supply contract, in line with the code requirements, that farmers and processors can use when negotiating agreements.”

Mr Thompson says that NSW Farmers and dairy groups have been advocating tirelessly for the code, so it is crucial that it delivers value to farmers.

“NSW Farmers fought for the code to be mandated and for it to provide clarity and certainty for farmers.”

“We are hearing reports of needlessly long and complicated contracts, but this should not be the case under the new mandatory code.”

“We will continue to advocate for transparency along the entire supply chain until farmers receive fairer prices. We are still in the dark around pricing agreements between processors and retailers, and we continue to urge the latter to lift their retail prices on dairy products.”

Date: Friday 29 May 2020
Media Contact:  Michael Burt  | 0428 228 988 | burtm@nswfarmers.org.au