A drop in milk prices on supermarket shelves could place downward pressure on the dairy industry, farmers have warned as the major supermarkets announce the first milk price cuts in over a decade.
This month, Aldi joined Coles and Woolworths in dropping the price of their one litre, generic brand milk from $1.60 to $1.55, with two-litre and three-litre milk bottles also experiencing price reductions of five cents across the board.
NSW Farmers Dairy Committee Chair Malcolm Holm said while the price cuts would bring a welcome reprieve to households in a cost-of-living crisis, it was critical Australian dairy farmers did not bear the brunt of discounted prices on supermarket shelves.
“The cost of producing fresh Aussie milk is only going up and up for our industry, and yet the supermarkets are putting their milk prices down,” Mr Holm said.
“While cheaper milk is good news for consumers, it’s important that farmers do not foot the bill for these price drops, especially as input costs keep climbing higher and higher in their businesses.
“Consumers are in a cost-of-living crisis – but so are our farmers, and we can’t let the dairy farmers bear the cost of these discounts when they’re already under such pressure.”
As the nation’s competition watchdog continues to investigate the behaviour of the major supermarkets, Mr Holm said keeping a close eye on the pricing practices of the grocery sector would remain essential.
“We want checkout prices to come down because inflation is reducing and supermarkets are pricing their products fairly, not because farmers are paying the price,” Mr Holm said.
“Milk prices that don’t cover the costs of production are forcing many farmers out of the industry, and as a result, milk production in Australia has hit a 30-year low.
“Our dairy farmers are incredibly tough, but the reality is they need fair prices to keep farming, and to keep putting that fresh Aussie milk in fridges day in, day out.
“We don’t want a future where milk prices for consumers skyrockets again because farmers have gone out of business and our milk supply has dried up.”
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