FACED with rising hay and feed costs into summer, 29 WA dairy farmers who supply Lion Dairy and Drinks (LDD) have received a welcome financial boost.
They are being paid an extra two cents a litre farmgate price for their milk until the end of the financial year.
The Lion Dairy Pride Partnership payment of 2c/l extra started flowing through to farmers this month and applies to milk collected after October 15.
It takes the weighted average price paid to its WA suppliers for milk to 52c/l – actual payments vary depending on milk quality and volume at certain times of the year.
Launched in December 2016, the Lion Dairy Pride Partnership program was the first online program designed to encourage Australian dairy farmers to measure, evaluate and improve key sustainability areas on their farms.
Dairy Pride offers Lion suppliers practical and informative information and is a one-stop shop for industry resources within its five modules – milk quality, animal welfare, people, community and wellbeing, the environment and business management.
LDD external relations director Elise Gare said the extra 2c/l payment recognised the strong partnership LDD has with its suppliers.
“At Lion Dairy and Drinks we are committed to building long-term sustainable and mutually beneficial partnerships with our dairy suppliers,” Ms Gare said.
“The Lion Dairy Pride Partnership payment is consistent with Lion’s long-term, partnership approach to supplier relationships, and to ensuring that the dairy industry in Australia is sustainable.
“As part of the Lion Dairy Pride Partnership payment we will be asking all our dairy suppliers to revisit the Lion Dairy Pride program and to endeavour to achieve either a four-star rating across each of the five modules, or to work with the Lion farm services team to do this, before the end of the year.
“Many of our suppliers have already achieved four or five star rating across the various modules.
“Our farm services team is working with our other dairy suppliers who are still on the Lion Dairy Pride journey to help them put in place steps to become more sustainable on farm.
“We are confident that this partnership payment will go a long way towards further strengthening our relationship and enhance on-farm sustainability.”
As part of the program all LDD suppliers also have free access to 24-hour independent counselling services for farmers, their families and staff called the Lion Dairy Pride Farmer Support program.
As reported in Farm Weekly recently, Kitchen Farms, Boyanup, will use a $10,000 combined LDD and Landcare Australia grant, part of the same Lion Dairy Pride program, to put solar panels on the roof of the dairy to help reduce $100 a day energy costs.
Kitchen Farm’s Ray Kitchen, who produces about 3.5 million litres of milk a year for LDD, welcomed the extra 2c/l payment, particularly this year.
“It’s been the hardest year I can recall, it was dry with a very late break to the season and then it was cold and nothing grew, but it’s good now,” said Mr Kitchen who has just finished baling ryegrass and clover for summer feed for his 380-400 cow Holstein herd.
“But hay and silage are going to be expensive and probably hard to find if we haven’t got enough stored fodder to get us through (summer and into autumn) because of the demand from the drought areas over east.”
Ms Gare pointed out the Lion Dairy Pride Partnership payment was not connected to LDD’s Be True Blue Farmer Drought Fund which has raised $1 million since it was launched last month to help dairy farmers impacted by drought in New South Wales, South East Queensland and Northern Victoria.
Those funds are being raised by a temporary 10c/l wholesale price increase for all Dairy Farmers and Pura brand white milk one to three litre containers sold to participating retail outlets in those States.
The first $1m raised will begin to be distributed to drought stricken Eastern States LDD suppliers next week.
“With 100 per cent of New South Wales drought-declared, along with areas across Northern Victoria and South East Queensland, we know that many of our dairy farmers are doing it tough,” said LDD managing director Kathy Karabatsas.
The Be True Blue Farmer Drought Fund 10c/l wholesale milk levy will apply until January 31.
LDD produces and sells Masters milk in WA and no wholesale drought levy applies to that brand.
In June LDD announced its 50c/l average farmgate price in WA for this year would also apply for the 2019-20 financial year under its two-year fixed pricing policy.
Most of its WA milk suppliers are on three-year contracts with two years still to run.
Last month its owner, Lion Pty Ltd, and Lion’s parent company Kirin Holdings Company Ltd announced LDD is for sale.
Apart from white milk, LDD processes and markets flavoured milks, premium cream and cheeses, yoghurts, dairy desserts and fruit juices.
Its Lion Dairy Pride program was instigated under previous innovative managing director Peter West who is now managing director at Coca Cola Amatil which is tipped as a contender to buy LDD.