Dairy farmers reassess futures before signing milk contracts, as many exit the industry

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Twice a day for more than half a century, the Wilson family have milked cows in their dairy at Calico Creek near Gympie. But now, owner Martin Wilson has called it quits.

His jersey milkers have been sold and the bulls will be next, as he converts his farm to running more valuable beef cattle.

“It was a prime time to get out. It is getting harder and harder to try to find staff,” he said.

“As far as going ahead, 10 years, 20 years or whatever it may be with Woolworths and Coles determining the price at the end at the shelf, I can’t see any future.”

Mr Wilson’s dairy shed will be dismantled.(ABC Rural: Jennifer Nichols)

The perilous state for Queensland dairy will become clearer in July, when farmers decide whether to sign up to new milk contracts.

Despite processors now offering record prices, dairying is in steep decline and there is some speculation about whether it will survive the next decade.

Since deregulation in 2000, the number of dairy farms in the state has shrunk from 1,500 to fewer than 280, and the exodus isn’t over.

Of 573.8 million liters of fresh milk sold in Queensland last year, just 53 per cent of it (309.5 million litres), was produced in Queensland, the rest was trucked up from southern states where the cost of production was lower.

Cows in the yard by the dairy.
Cows need to be milked even if it is Christmas morning.(ABC Rural: Jennifer Nichols)

Livestock specialist John Cochrane recently sold five Queensland dairy herds in five weeks.

“Even though the prices have increased a little, the costs are going through the roof.

“Labour is very difficult to get and the farming age is climbing up so they really need help. They need some labor and they can’t get it.

“Cattle prices are good, land prices are good. I f there’s no money, why would they want to continue.”

a man with his hands in his pocket standing in a room with fridges looks at the camera
John Cochrane has helped sell five dairy herds in five weeks.(ABC Rural: Jennifer Nichols)

Generational change

After five generations in dairying, Mr Cochrane’s own family has finished milking cows.

His son recently left the industry.

As the owner of Kenilworth Dairies, Mr Cochrane senior now relies on other farmers to secure milk for processing in his factory.

“The social pressures are so hard these days and there’s some good jobs around where they can get really good money,” he said.

“Who wants to be out of bed at three o’clock Christmas morning milking cows for people that don’t want to pay for your product?”

Dairy cows eating from a long trough.
Farmers say feed costs have increased.(ABC Rural: Jennifer Nichols)

Representing dairy farmers in Queensland and northern New South Wales, who primarily supply the fresh milk market, eastAUSmilk co-chief executive Shaughn Morgan said input costs had doubled over the past year and he was worried about the future.

“It’s deeply concerning, particularly when some of the processors are bringing milk up from Victoria,” Mr Morgan said.

code of conduct

Australian Competition and Consumer Commission (ACCC) deputy chair Mick Keogh said the mandatory dairy code, which was introduced in January 2020, had improved pricing transparency for farmers.

By June 1, milk processors are required to publish the prices they will be offering farmers for new contracts in July, and the ACCC has moved from educating processors about the code to enforcing it.

A man in a blue shirt stands outside a building.
Mick Keogh says the dairy code has increased transparency.(ABC Rural: Kallee Buchanan)

“There’s been a culture change in the industry, whereas in the past, processors on occasions didn’t even release their prices before June 30,” Mr Keogh said.

“Now farmers have got 30 days in a sense before the new milk season begins, to look at all the offers that are available and make their own decisions rather than be forced into having to jump on something because they didn’t know what else was available.”

Tough times

Dairy Cooperative Norco, whose processing plant and suppliers have been hard hit by flooding in northern New South Wales and South-East Queensland is offering a record price of 84.5 cents per liter for its northern suppliers and 82.3 cents for its southern suppliers.

Lactalis has flagged it will be increasing its farmgate milk price by nine cents per liter to 81 cents per liter in Queensland and northern New South Wales.

A bull in the foreground with other cattle in the background of a paddock.
Generations of breeding went into the Wilson family’s herd.(ABC Rural: Jennifer Nichols)

Martin Wilson said his decision to quit dairying was made easier by the fact his milkers didn’t go to the meatworks.

Maleny Dairies owners Ross and Sally Hopper bought the herd to grow their business.

The couple is investing millions of dollars into upgrading their processing and bottling plant. They own one dairy farm, lease two others, and are currently supplied by another 10 local farmers.

Ross Hopper smiling at the camera with stacked crates of milk and the robot behind him.
Ross Hopper is working to expand Maleny Dairies’ operations.(ABC Rural: Jennifer Nichols)

“It’s working, obviously it all comes down to customer support,” Mr Hopper said.

“It comes down to the story of what we’re promoting. We want to look after our farmers, we want to pay them the right price because obviously if we don’t have our farmers we won’t have a future of local milk .”

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