Minister hopeful of dairy solution

"I'm hopeful we will see a commercial arrangement, a solution, before the next five," Mr Lewis said this week, referring to five Harvey Fresh suppliers who were told their milk will not be collected in the new year.

But Mr Lewis, who came to the portfolio seven days before the WA milk over-supply crisis came to a head on September 30 with Brownes Dairy dumping three suppliers, said he did not believe he could do anything immediately to help them.

"Unfortunately, it really comes back to supply balance," Mr Lewis said.

"We are looking at uncapped supply systems, export markets and cheese factory-type issues but unfortunately, where we are at is coming up against global (dairy) volumes," he said.

"I'm aware of a number of commercial proposals for some more cheese production, a co-operative operation, infant formula, high-pressure processing for fresh milk to produce more extended shelf life (ESL) milk - a whole host of things.

"The frustrating bit, and the difficult bit for me, is that we don't have a specific proposal on the table in front of us.

"If there was a proposal, we could look at where we (State government and Department of Agriculture and Food WA) might be able to help.

"It could be with the R&D (research and development) process, establishing export markets, guaranteeing establishment loans that might help a co-operative find its feet, but we don't have a firm proposal at this stage."

Mr Lewis met dumped Brownes suppliers, Dale Hanks and wife Leanne, Graham Manning and wife Jane and Tony Ferraro and sons Richard and Paul, on the verandah at Mr Hanks' Harvey farm on Wednesday last week.

Waterloo farmer Dean Barbetti, one of the five told by Harvey Fresh owner Parmalat off-contract collection of their milk will end in January, also attended.

WAFarmers' dairy council president Michael Partridge and Murray-Wellington MLA Murray Cowper, who set up the meeting for the farmers, also sat in.

Mr Lewis described the meeting, which went for more than an hour and ended with a tour of Mr Hanks' dairy, as "very emotional".

Later, on his way to Bunbury, he toured the Harvey Fresh plant with general manager Paul Lorimer and Brownes' still operative former cheese plant at Brunswick Junction - Mr Lewis had a lengthy private meeting with Brownes managing director Tony Girgis on his return to Perth that evening.

In Bunbury Mr Lewis met with dairy industry officials at Dairy Australia's Western Dairy hub that has taken over dairy research, development and extension from the Department of Agriculture and Food WA (DAFWA).

"The general consensus was that government can play a participating role in looking at the structural issues within the industry," Mr Lewis said.

"I met the Dairy Industry Growth Steering Committee and I'm very keen to turn it into some sort of leadership group within a three to six months timeframe.

"I'm writing back to them saying come on, let's get cracking on looking at the structural issues."

Mr Lewis said he also discussed WA's dairy problems with Federal Agriculture Minister Barnaby Joyce on Friday - Mr Joyce was in WA ahead of The Nationals WA State conference in Geraldton at the weekend.

"We discussed how we could deal with the export protocols Brownes has run across, also export licencing for their (Brunswick Junction) plant," he said.

"AQIS (Australian Quarantine and Inspection Service which provides inspection and certification for a range of agriculture products to be exported to ensure compliance with overseas countries' importation requirements) comes under his portfolio so he said he would look into it.

"It's only a very small volume in the scheme of things, but it might make a big difference if we can start shifting it along the supply chain."

Brownes exports in it's own right and with third-party customers to Singapore, Taiwan, China, Hong Kong and South Korea from its Balcatta processing factory.

Mr Girgis said since he visited Asia in July Brownes had been working on what he described as "a number of other niche opportunities".

But these required reinstatement of the Brunswick Junction plant's export licence, he said.

"We have carried out a lot of work required by AQIS in October already," Mr Girgis said.

"The reinstatement of the licence would allow us to send commercial samples greater than 10 kilograms to enable customers to test products for suitability.

"We hope to receive the reinstatement before the end of the month in any case.

"As everyone is aware, these markets have gotten tougher over the past two years due to the oversupply conditions spilling out of Europe into Asia, so we have to work a lot harder for a lot less," Mr Girgis said.

He said he found Mr Lewis "very engaged" on dairy issues.

Traditionally, Melbourne Cup week is the production peak of dairy herds across southern Australia, but with good seasonal conditions, including cooler temperatures, in WA the spring flush peak is still expected to be two to three weeks away.

Mr Manning and Mr Hanks have dried off, sold or leased out most of their herds and are transitioning out of the dairy industry across to beef cattle.

Mr Ferraro and his sons are still milking a reduced number of cows.

WAFarmers has been paying the transport cost out of profits from its own WAFarmersFirst brand milk, to help the Ferraros send milk to Eastern States.

That arrangement was due to end yesterday when $40,000 in WAFarmers' funding ran out.

Mr Ferarro, who has previously said he would try and hang on until Christmas, said he expected his milk to be picked up Tuesday but did not know what would happen after that.

According to industry sources, four of the five unwanted Harvey Fresh suppliers have been selling cows and downsizing milking herds in preparation for leaving the industry if they are also forced out.

Harvey Fresh owner Parmalat is trucking 80,000-100,000 litre loads of Harvey Fresh milk 4200 kilometres to Darwin to soak up some of the spring flush excess.

The five farmers it told it will not collect from, had previously declined to sign new contracts with Parmalat after it took over but the company continued collecting their milk after their existing contracts expired.