ACCC dairy inquiry: More information and industry body needed | eDairy News

ACCC dairy inquiry: More information and industry body needed

The Australian Competition and Consumer Commission dairy inquiry’s final report was released this week.

Tasmanian Farmers and Graziers Association dairy council chairman Andrew Lester said that while the organisation supported introducing a mandatory code, more information on what it would contain and extensive industry consultation would be needed.

“We all know the voluntary code isn’t working,” he said.

“The problem with a mandatory code is that once it’s drafted into legislation we don’t have a say in it … we’d need to make sure it wasn’t going to disadvantage producers.”

The ACCC found significant imbalances in negotiating power at all levels of the dairy supply chain, including between processors and retailers, but particularly between farmers and processing companies.

The report says processors have information about minimum prices farmers are likely to accept, suppliers do not have information about the maximum processors can pay.

While a voluntary industry code of conduct is being introduced, the ACCC says this is non enforceable and a mandatory code is recommended.

The report also highlights the need for an independent body to oversee disputes between farmers and processors.

It is an idea supported by the Australian Dairy Farmers group and the TFGA.

ADF president Terry Richardson praised the call for an independent mediator.

“It is vital that we have a mechanism to ensure farmers are protected in any disputes and this will form a central part of the current Code of Practice review process,” Mr Richardson said. “We recognise that there is some support for a mandatory code.”

However, he said the voluntary code of conduct, which is now being reviewed, was set up to bring industry together and develop an agreed set of values for processor contracts.

He said the ACCC’s analysis would be part of the ADF’s review process.

The report analysed the impact of $1 per litre milk and found farmer earnings remained the same, regardless of whether milk was sold as private label or branded milk.

Mr Richardson said $1 per litre was not sustainable in the long term.

Mr Lester agreed this issue needed more scrutiny.

“When you have milk at $1 a litre, that’s taking money out of the overall supply chain, so processors have less money to pay producers,” he said.


Source: The Weekly Times


Tags: , ,
Any claim arising from the information contained on the eDairy News website shall be submitted to the competence of the ordinary courts of the First Judicial District of the Province of Cordoba (Primera Circunscripción Judicial de la Provincia de Cordoba), Republic of Argentina, in the city of Córdoba, excluding any other jurisdiction (Federal jurisdiction is also excluded).

One Comment;

  1. Dairyend said:

    Yes a mandatory code needs to be set up well
    Processors can sign up to a voluntary code and ignore it when it suits them.
    This is a once in a lifetime opportunity for milk producers to have the ability to negotiate on equal terms


Criteria in the moderation of comments that eDairy News will take into consideration in all its publications.

  • They will not be considered insults of any kind against anyone,, whether a user, moderator or publisher. Complaints made with the name and surname of the author of the commentary will only be accepted after confirmation by the moderator.
  • Unsubstantiated and gratuitous destructive criticism or expressions of bad taste, whether offensive, racist or xenophobic.
  • SPAM, (Insert links to web pages not related to the subject, provide emails, etc...)
  • Comments that are meaningless with the footnote or the dairy sector.

Related posts