Funds sought for dairy fight

30 May, 2002 07:00 PM
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THE Australian Dairy Farmers Federation would not seek extra money from associated farming bodies to help fend off a National Foods Ltd appeal against collective bargaining.

Instead, the ADFF would continue to seek special funding provisions from the Federal Government to fight the appeal.

Due to the cost of defending the Australian Competition and Consumer Commission ruling, ADFF planned to access the Trade Practices Act, which allowed it to apply to the Federal Attorney General for funding assistance.

"I do not think any farm body of any description has got the money to spare," ADFF president Pat Rowley said.

He said application to the Attorney General would take time, and meanwhile discussions were underway with NFL to find an agreement to shortcut a lengthy court appeal process, expected to last until February 2003.

Mr Rowley said the main issue for ADFF was that dairy collective bargaining groups had to be of reasonable size to be effective.

The NFL appeal application, lodged with the Australian Competition Tribunal on April 2, claimed conditions in the ACCC ruling allowed collective bargaining groups to monopolise milk supply to NFL processing plants.

The application reads: "NFL seeks variations to conditions C2 & C3 of the determination to ensure that any collective bargaining group pursuant to the determination is not capable of exercising market power, or significant market power in respect of the supply of raw milk to NFL, in particular raw milk intended for processing into drinking milk for consumers.

"Further, NFL seeks a variation to the criteria in condition C2 to ensure they are sufficiently certain."

NFL was also not happy with the ACCC ruling, which allowed all but one of WA's dairy farmers to make up one regional collective bargaining group.

WAFarmers dairy section president Tony Pratico said NFL had made it known that it wanted collective bargaining groups based on seasonal differences such as irrigation and dryland farming.

However, Mr Pratico said the company's prices in the past had not reflected the different production costs in different areas.

"Their contracts don't reflect that a guy in the Harvey irrigation area in July has trouble producing milk and a guy in Albany has trouble producing milk in March, April and May," he said.

"They give the two guys the same price and same contract and say how you produce your milk in your area is your business."

Mr Pratico said he did not understand why NFL feared collective bargaining.

The ACCC determination, which ran out in 2005, also allowed the ADFF to talk to supermarkets during the home brand milk tendering process. The ACCC has allowed the ADFF to continue with these talks during the appeal.

Mr Rowley said the ADFF would speak with Woolworths representatives next week as the tendering process got under way.

"We are not going in there to thump the table but to build up a relationship and ensure there is a better understanding of the dairy industry before decisions are made," he said.

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