Farmers urged to picket supermarkets

17 Dec, 2003 10:00 PM

WA dairy farmers have been encouraged to picket supermarkets to raise retail milk prices and create better farmgate returns.

Vasse MLA Bernie Masters said in the UK dairy farmers had struggled with unsustainable milk prices in a similarly deregulated market to WA.

They were able to convince supermarkets to raise their milk price by informing consumers how retail discounting threatened their livelihoods.

He said this could be a way for WA producers to get a retail price rise significant enough to have an impact on the farm.

"If you leave Challenge (Dairy Cooperative) producers aside for the moment, because the price they're paying is an aberration caused by outside factors, then the average milk price is about 26 cents a litre to farmers," he said.

Farmers would need about a 6c/L farmgate price rise to remain profitable, which equated to about a 12c/L price rise on supermarket white milk, to offset the effect of prices remaining fixed on other dairy products.

Brunswick dairy farmer Paul Ieraci said the tactic was unlikely to gain support.

"It worked overseas but we're in a different environment here," he said.

"We could put consumers offside and we'd be on the supermarkets' territory, they'd put us 30 or 40m away where we couldn't do anything."

He said a better way to target discounting would be for the government to ban generic milk brands, which were used in the most aggressive bids for market share.

Mr Masters said a 12c/L price rise was unlikely to bother consumers.

"In the eastern states they are regularly paying more for their milk," he said. "A 2L bottle of milk sells for $2.75 there and $2.50 here, so that's 12.5c/L; a 3L bottle sells for $3.80 compared with $3.30 here, that's about 16c/L."

He said farmers needed to work together for the dairy industry to survive.

"The response so far has been neutral," he said.

"I've got to say that I'm disappointed in that because the future of the industry is in the farmers' hands."


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