The ADF template, which was sponsored by the Federal Government, is intended to safeguard both farmers and processors from potential breaches of the code, while also addressing other issues identified by the Australian Competition and Consumer Commission in its Dairy Inquiry.
“Farmers and processors won’t have to spend time developing new agreements from scratch, although the document isn’t a substitute for legal advice and we recommend parties seek out appropriate legal advice in relation to matters set out in the template,” ADF president Terry Richardson said.
The competition watchdog made several recommendations related to contracting practices, including that milk supply arrangements should be acknowledged in writing, processors should provide farmers with all contractual documents before the start of their agreement, and that those agreements should be simplified.
The template incorporates contractual obligations in the code and several other requirements that typically feature in a standard agreement. For example, the template expands on the code’s confidentiality requirements. This provides greater coverage for farmers and processors.
Mr Richardson said he expected farmers to have questions about the template, with ADF holding a series of nine webinars to talk directly to farmers, with services body Dairy Australia also developing useful resources.
“We will be encouraging farmers and processors to use this template and seek further information from ADF, either by attending one of the information sessions when they are organised, or by contacting our office,” he said.
The milk supply agreement template is available for download at http://australiandairyfarmers.com.au/code-of-conduct/contract-template/.