Light at the end of the tunnel: ADF’s Terry Richardson

If there’s one word dairy farming feels like at the moment, it’s exhausting. Sometimes – often – I wonder why we keep on slogging away. So, I asked dairy peak body, the Australian Dairy Farmers, to write a guest post titled simply “The Light at the End of the Tunnel”. It’s not an easy piece to write and I am incredibly grateful to ADF president, Terry Richardson, for taking up the challenge.

ADF president, Terry Richardso

ADF president, Terry Richardson

Last year was tough. It was tougher than tough for a lot of dairy farmers.

So, is there light at the end of the tunnel? I think as a farmer you just get used to riding a bike up and down those hills. To keep their heads above water, farmers must keep peddling their bike.

I could start talking about the global market showing a slight upward trend, or I could talk about the things that we have been working on to make sure last year never happens again.

There isn’t a quick fix and there is no silver bullet.

While we are an industry that has been under intense pressure, we are also an industry that has the know-how and resilience to overcome adversity and thrive in the long term.

ADF, together with the state dairy organisations have fought hard for farmers and continue to do so. Even though we won’t be able to solve all the issues farmers are facing, we have been working behind the scenes to relieve some of the pressures. We want to ensure that an unfair share of the risk in the value chain is not taken by the farmer and that events last year don’t ever happen again.

Our first aim is to show you that there is a tunnel. To us, this is the ongoing prosperity of dairy farmers’ and our clear intent is to ensure no dairy farmer is ever made to feel vulnerable over processor decisions. This is the reason we are working on a code of practice for contractual agreements between farmers and their processors.

Next, we need to show you that there is a light. The Effects Test is a tool regulators can use to judge whether a company is acting to unfairly reduce competition. With the potential for use in examining the business practices of the large supermarkets in Australia, and their strategies around $1 per litre milk, and $6 kg cheese.

Lastly, the Commodity Milk Price Index will be a tool farmers can use to better understand and plan for market volatility throughout the Australian dairy supply chain. This is the bike.

We need practical and viable solutions to increase transparency in the way the milk pricing system works, and to simplify milk contracts to ensure the volatility of the market is better balanced. Improving equity and transparency through the supply chain is one of the matters ADF is driving with the Australian Competition and Consumer Commission and the Federal Government.

We can’t do this alone, collaboration is the key to get us where we need to be. Our industry relies on all the elements to operate effectively. Farmers need processors and processors need customers big and small – so the solutions require all of us to work together to ensure a positive future.

While we can show farmers the tunnel, offer them a light and hand them the bike by working on the solutions for a long, sustainable future, it is still important that we continue to develop and improve these tools so farmers can keep peddling.

Farmers can help achieve this by grabbing every opportunity that comes their way, getting involved, joining a policy discussion through their state organisation and by showing the community that dairy farmers – regardless of the challenges they face are good business people, who care for their cows and work to enhance the well-being of the Australian people.

2 thoughts on “Light at the end of the tunnel: ADF’s Terry Richardson

  1. Fascinating, absolutely fascinating…

    The Effects Test (amendment to Section 46 of the Competition and Consumer Act 2010) applies to farmers (small businesses) dealing with processors as it does with processors dealing with retailers but no reference at all to the former by the ADF. Fascinating, absolutely fascinating.

    Code of Conduct? A voluntary framework on how to behave and conduct yourself in the commercial world…how quaint and yet ineffectual that concept has proven in the past across a number of other industries including the media, advertising, finance and IT. A chippy slap for those that misbehave and yet it offers no protection or risk mitigation for dairy farmers. Fascinating, absolutely fascinating.

    Commodities Milk Price Index? Dairy farmers don’t produce and sell commodity milk, they sell raw milk as input into a process that then produces commodity, volume, value-added and high value products. So nothing there bears any relevance for dairy farmers other than to tether them even further to the value of their input product (raw milk) being determined by the strategy, production, capability and the profitability of the processor that buys their milk. By the way the market already has one, its called the GDT (owned by Fonterra Group for those that don’t know) and it is of no use to dairy farmers what so ever, in fact it has had a detrimental impact on dairy farmers returns at the farmgate as it plays into processors argument of linking dairy farmers raw milk value to the processors product value. Fascinating, absolutely fascinating.

    The rest was just rhetoric and jibber jabber.

    Anyone who thinks the dairy farmers interests and livelihood is represented by the ADF is living in fantasy land and will pay the price for this misguided belief.

    Fascinating, absolutely fascinating. There are alternatives but no-one wants to talk about them.

    RIP australian dairy farmer.


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