Australia’s dairy industry is facing a critical juncture as farmers contend with milk prices that fail to cover production costs, compounded by the financial burdens of recent droughts and floods. Ben Bennett, President of Australian Dairy Farmers (ADF), highlighted that despite a modest 5% increase in milk prices, these adjustments are insufficient to offset the escalating expenses associated with feed, water, and infrastructure recovery.
The situation is exacerbated by supermarket pricing strategies that keep retail milk prices static, even as production costs soar. Bennett drew a parallel to the rapid price increases seen in other commodities, such as bananas, following natural disasters, questioning why dairy products do not receive similar market adjustments.
Financial losses for dairy farmers have reportedly exceeded $1,000 per head this season, with projections indicating even greater deficits in the upcoming year. The liquidity crisis extends beyond farmers to the broader service industry that supports dairy operations, threatening the viability of regional economies.
ADF is urgently calling for government intervention, including immediate crisis support measures such as feed and water transport subsidies, cash grants, low-interest loans, and the activation of Category C and D disaster support mechanisms. Without swift action, the industry risks a significant structural decline, undermining Australia’s food security and the sustainability of its dairy sector.
Industry Insight:
The convergence of natural disasters and inadequate pricing structures is placing unprecedented strain on Australia’s dairy industry. Stakeholders must advocate for policy reforms and support mechanisms to ensure the sector’s resilience and long-term viability.
Source : Dairynews7x7 JUne 7th 2025 Read full story here