In a response to Labor’s floor price for dairy farmers, Agriculture Minister David Littleproud has announced if re-elected the Coalition Government would invest $560,000 to have Australian Dairy Farmers contract an independent research group to develop and market test a new platform.
It would be similar to Australian Wool Innovation’s trade portal and trading in the grains and cotton industry.
“This could mean a farmer could sell milk to multiple processors, or could contract a portion of their future milk supply as a hedge – with an option to pull out and sell elsewhere if the farmer receives an offer to pay more for their milk,” Mr Littleproud said.
Mr Littleproud said the new platform would allow dairy farmers to trade their future supply, and give them options and milk swaps, which would allow growers to switch processors to get better prices.
“Dairy farmers need more flexibility in how they sell milk – a new platform will give them more options, opportunities and flexibility,” he said.
He said dairy farmers currently had limited selling arrangements, basically a supply contract.
“Trading future supply, as available to other agricultural commodities, gives certainty and also requires price disclosure, which means farmers can know the trading price of milk,” he said.
He said the research agency would work with financial institutions. It would report back in February 2020.
At Kempsey Show on Tuesday, Mr Littleproud said while was taking his time on a plan for dairy, he wanted it to be achievable.
“That’s why I fought so hard with supermarkets to work with me and they have come some way, but they have along way to go,” he said.
“All dairy farmers want is a fair price, that’s all any farmer ever wants, they don’t want charity they just want fairness.”
It would be similar to Australian Wool Innovation’s trade portal and trading in the grains and cotton industry.
“This could mean a farmer could sell milk to multiple processors, or could contract a portion of their future milk supply as a hedge – with an option to pull out and sell elsewhere if the farmer receives an offer to pay more for their milk,” Mr Littleproud said.
Mr Littleproud said the new platform would allow dairy farmers to trade their future supply, and give them options and milk swaps, which would allow growers to switch processors to get better prices.
“Dairy farmers need more flexibility in how they sell milk – a new platform will give them more options, opportunities and flexibility,” he said.
He said dairy farmers currently had limited selling arrangements, basically a supply contract.
“Trading future supply, as available to other agricultural commodities, gives certainty and also requires price disclosure, which means farmers can know the trading price of milk,” he said.
He said the research agency would work with financial institutions. It would report back in February 2020.
At Kempsey Show on Tuesday, Mr Littleproud said while was taking his time on a plan for dairy, he wanted it to be achievable.
“That’s why I fought so hard with supermarkets to work with me and they have come some way, but they have along way to go,” he said.
“All dairy farmers want is a fair price, that’s all any farmer ever wants, they don’t want charity they just want fairness.”
