WA dairy farmers dismayed at 'stagnant' milk prices amid rising costs

Australia Broadcast Center

12 hours ago

West Australian dairy farmers say they are disappointed by the ongoing stagnation of farmgate milk prices as repeated dry seasons and rising costs take a toll.
Processors recently published their 2025-26 supply agreements as part of transparency measures in the Dairy Industry Code of Conduct.
For the third successive year, WA processors have been offered no substantive price increase.
The disappointment was shared by interstate producers, where processors have offered slight increases.
Dairy farmers in WA's South West have called on local milk processors to review their offers, with one major processor, Bega, already conceding to a two-cent-per-litre rise.
Brunswick dairy farmer Michael Partridge said the initial price offered by Bega was not enough.
"Prices haven't moved for three and a half years; last year was a really hard year for farmers in Western Australia," he said.
"The Dairy Farm Performance Program, which Dairy Australia did, showed 50 per cent of dairy farmers made a loss, and there was an average 2 per cent return on investment, and the prices didn't move, which was extremely disappointing."
Though 2-cents-per-litre extra from Bega was not enough, Mr Partridge said it was a start.
"I was pleased to hear that Bega has announced a 2-cent price rise, but it's not enough to turn the industry around," he said.
He called on other big processors to do the same.
"We really need the other two processors, Brownes and Lactalis, to follow suit, and push it further," he said.
WAFarmers Dairy Council president Ian Noakes, who also runs a dairy in the south west of the state, said the stagnation of pricing ignored the fact that production costs had risen substantially for dairies.
Mr Noakes said his lobby group was seeking a 5-cent increase to support farmers to be profitable.
He said WA's average farmgate price ranged between 60-70 cents per litre, and that pricing hadn't materially changed in the last three years.
While East Coast dairies had access to overseas export markets, WA's dairy farmers were constrained to a comparatively small, local market.
For that reason, Mr Noakes partially blamed the major supermarkets' low-priced home brand milk ranges for the subdued pricing offered by WA processors.
Mr Noakes recently presented to an ACCC inquiry into Australia's major supermarkets, urging the regulator to recognise the damage of home brand milk ranges.
The ABC contacted WA's major dairy processors for comment, of which Coles was the only one to respond.
"We introduced a direct sourcing model for our own brand milk in 2019 to ensure we could provide fair, competitive and guaranteed farm gate prices to dairy farmers directly," a Coles spokesperson said in a statement.
"Our multi-year agreements for our direct supply dairy farmers aim to support them in longer-term planning, and as part of the process of setting these agreements, we consider a range of factors including supply volumes, customer demand, farm production costs, and dairy market condition,s including commodity prices."
Harvey Fresh's parent company, Lactalis, declined to comment, and Brownes and Bega were yet to respond.