Why many farmers are unhappy about great prices

A journalist rang me the other day with a really simple question: was I happy about Fonterra’s opening price of $5.85kgMS, the equivalent of about 45 cents per litre?

Simple question. Answering it is not so simple.

Historically, it’s a really good price
Honestly, I can’t remember an opening price this high. For those of you not familiar with the intricacies of our milk pricing system, processors announce an “opening price” at the start of each financial year, which is what they consider a conservative figure that should only increase as the year progresses.

Freshagenda’s chart of this year’s opening prices shows it’s not just Fonterra offering a good start to the year.

ProcessorPrices

Source: Freshagenda

Compare those opening prices for 18/19 with the closing prices over the years in Freshagenda’s chart below. Pretty darn good.

FreshagendaCdtyFgate.jpg

Source: Freshagenda

But farmers need to make up lost ground
Dairy Australia’s revelation that one in five dairy farmers is planning to quit discussed in my last post helps to explain why farmers are not celebrating. We have a lot of ground to make up.

Last year’s Dairy Industry Monitor reported that the Victorian farmers in the project (generally larger and better resourced than the average farm) had a return on assets of just 2.5% in 16/17, following on from 0.6% in 15/16.

Many farmers have higher debt loadings than ever before.

And the big dry is sending the cost of feeding cows skyrocketing
Even with a great price this year, there’s a real likelihood we’re going to struggle again.

The pellets we feed the cows during milking have surged to an eye-watering $400 per tonne while the stream of B-doubles heading to drought-affected NSW is making reasonably-priced hay suitable for milkers impossible to find.

Raiinfall2018toJune.jpg

Bureau of Meteorology: Precipitation year to date

All this while (with the exception of the lucky devils on the SW coast) it’s been horribly dry on farm, with the increasing prospect of another El Nino on the way for Spring.

To top it off, expectations were high
Analysts have been rather bullish, including Freshagenda, which as recently as June 6, wrote:

“Our forecast range for the 2018/19 average southern Australia farmgate milk price has improved to $6.10 to $6.50kgMS with a significant lift in the underlying commodity milk value (CMV) since our April update, which we now see in the range of $5.60 to $6.00kgMS.”
Freshagenda

It’s not just been farmers blindly following the opinions of analysts, either. On May 23, Fonterra increased its forecast closing price for Kiwi farmers to NZ$7.00.

Add this to the hype surrounding competition for milk supply from processors aggressively investing in stainless steel and expectations were sky-high. And the opening prices fell short.

“All I want is a market driven price, not a processor driven price,” one prominent farmer told me after Fonterra’s opening price announcement.

That’s where that second chart from Freshagenda comes in again. Are we getting a fair go? Is all that value adding reaping dividends?

FreshagendaCdtyFgate

So, where to from here? For the final word on all the intricacies of milk pricing, I’ll leave you with this video from the Freshagenda team.

 

Why 1 in 5 dairy farmers plans to quit

One in every five dairy farmers is planning to quit. Not just wanting – but actually planning – to quit.

According to research from Dairy Australia’s Situation and Outlook report released today:

“The proportion of farmers making plans to leave the industry has increased steadily since 2014. At that stage, 10% said they were making plans to leave and this has now doubled to 20% in 2018.”
– Dairy Australia, June 2018, Situation & Outlook Report

“Is it good to have a clean out of the bottom 20%?”
That’s a comment I’ve heard from some rather comfortable industry types but the truth is that those planning to leave simply aren’t all bad farmers.

There’s been an 18-year shakeout of Australia’s dairy farmers since deregulation. Even if you’re in the “bottom” 20 per cent now, you’re not doing too badly.

In my short lifetime, I’ve seen farming become a real science.

Jeepers, I’m in a course right now learning about the metabolism of different kinds of lipids and its impact on cow nutrition! Samples of river water are at the lab being analysed for everything from iron levels to coliforms. And I know the reference ranges for potassium, phosphorous and pH in our soils off by heart.

FIGJAM? No, I’m not remarkable. I’m just surviving.

I suspect the “bottom” 20 per cent right now is more accurately described as the most vulnerable 20 per cent. Almost every farmer is at the bottom sometimes. Even the best starting out with big debts; growing and taking on new debts; or hit with drought, divorce or death are vulnerable.

Yep, a lot of them are the future of our industry. We need them.

Besides, as Mary Alexander put it on Twitter this morning, it’s not just going to be those in the toughest positions who leave – it’ll also be those at the top of their game who can.

Why are 20% of Aussie dairy farmers planning to quit?
Well, let’s be frank. This is the third year in a row where more than a third of dairy farmers haven’t made a profit. Nationally, just 55% of farmers are positive
about their own businesses.

Worse still, farmers lack confidence in the future of Australian dairy farming. According to the S&O report:

“Farmer confidence in the dairy industry’s future stands at 47% in 2018 and this represents the third consecutive year of steady decline in sentiment. Over the past four years, confidence has dropped from 75% to 47%.”
– p. 5, Dairy Australia, June 2018, Situation & Outlook Report

Tellingly, farmers are again considering switching processors at rates that would have been inconceivable before 2016.

Everything changes, everything stays the same
The most demoralising thing about our industry today is that despite all the upheaval, dysfunction, noise and pain, very little has changed.

The processors continue to play opening price games, with the biggest of them, Saputo, only declaring what it will pay from July 1 onwards yesterday and number two, Fonterra, still yet to open as I type.

There has been no commitment – not even a timeframe for decision-making – from our peak dairy advocacy body or the government to implement the ACCC’s recommendations.

And farmers are painfully aware that MG’s transgressions earned it little more than a slap on the wrist while Fonterra has escaped any penalty other than the ravaging of its reputation.

Killing the goose that laid the golden egg
We’ve seen how profitable dairy processing can be and the massive investments processors are making in new capacity. But the goose must be fed. And, this time, I don’t think a couple of good milk prices will do the trick.

 

 

 

ACCC explains mandatory codes

mandatorycode

Since the ACCC recommended a mandatory code for the interactions between dairy farmers and processors, there’s been a lot of talk about what this might mean. To help sort the fact from the fiction, I asked the ACCC’s deputy chair, Mick Keogh, about the fundamentals.

Milk Maid Marian is really grateful to Mick for his explanation.


MickKeogh2

Mick Keogh, deputy chair, ACCC

 

MMM: How does a mandatory code differ from a prescribed voluntary code?

MK: There are three types of industry codes – (1) a voluntary code (such as the current Dairy Code), (2) a prescribed voluntary code (such as the Food and Grocery Code), and (3) a mandatory code (such as the Horticulture code).

A voluntary code is one developed by industry which participants voluntarily agree to by becoming signatories, but which has no penalties attached to breaches, and participants can choose to opt out of at any time without disadvantage.

A prescribed voluntary code is one which participants voluntarily agree to by becoming signatories, and which can have penalties or sanctions associated with breaches by participants.

A mandatory Code is one which all the relevant industry participants are bound to abide by, and which may have penalties or sanctions if a participant breaches the code.

The key difference between a prescribed mandatory code and a prescribed voluntary code is that a prescribed voluntary code only applies to industry participants who voluntarily choose to become a signatory to the code. Signatories can choose to withdraw and cease to be bound by a voluntary code at any time (although they will still be liable for breaches that occurred while they were signatories). In contrast, a mandatory code is legally binding on all industry participants specified within the code.

Prescribed voluntary codes and mandatory codes are both developed by Government in consultation with industry participants and the public, and administered by the ACCC. The ACCC can take enforcement action against parties that a prescribed voluntary code or mandatory applies to. Remedies include injunctions, damages, non‑punitive orders and other compensatory orders. Penalties and infringement notices may apply, but are more likely in a mandatory code than a prescribed voluntary code.

Any person who suffers loss or damage due to a contravention of a prescribed voluntary code or mandatory code can also bring a court action for damages.

MMM: What are the pros and cons of each?

MK: In the context of the dairy industry, the ACCC found that a mandatory code is likely to be stronger than a voluntary code in both the coverage of its enforceability and the potential for its substantive obligations to address issues which lead to market failures. We found that dairy processors are unlikely to volunteer to be covered by a prescribed voluntary code that is strong enough to address the market failures we identified in the dairy industry.

MMM: What is the normal process involved in drafting a mandatory code?

MK: If the Government agrees to pursue the creation of a prescribed mandatory code, the process will involve several stages, including stakeholder consultation with businesses, consumers and relevant government agencies, including the ACCC.

Following consultation with the industry, the responsible department will prepare a draft Regulatory Impact Statement, which evaluates the relevant issues and problems in question, objectives of a potential code and options for addressing the identified issues. This statement would be released for public consultation before it is finalised.

Afterwards the Department with policy carriage will draft the text of the proposed code and may  seek public feedback on it.

When it is finalised, the Governor General will make a regulation prescribing the code. The code regulation will then be registered and tabled in each House of Parliament, where it can be disallowed within 15 sitting days in each House.

Treasury processes to prescribe an industry code are set out at: https://treasury.gov.au/publication/policy-guidelines-on-prescribing-industry-codes/process-and-consultation-after-a-decision-to-prescribe-an-industry-code/

MMM: How long does it typically take to put a mandatory code in place?

MK: The time it takes to put a prescribed code in place (from announcement to implementation) will depend on a range of factors.

The time can range from about a month (as was the case for the Wheat Port Code and the Sugar Code) to several years (including a transition period, for example for the Horticulture Code).

MMM: What is involved if stakeholders agree that a mandatory code needs to be revised?

MK: A prescribed mandatory code may be subject to review after it has been implemented. For example, the Sugar Code must be reviewed within 18 months of its commencement, and the Wheat Port Code must have its first review within three years of its commencement.

The review involves a public consultation process to seek feedback from a wide range of stakeholders. A review can be conducted by the Government Department with policy responsibility for the particular code or alternatively by an independent body or industry experts. The review may consider options for repealing the code or amending it.

 

 


 

Dairy crisis in dates disgraces ADF and minister

Here’s a potted history of the dairy crisis. It’s worth remembering:

April 2016                   MG stuns the dairy community with the clawback

May 2016                    Fonterra follows suit, crashing its price

May 2016                    Milk price index announced

August 2016                Ag minister Barnaby Joyce says he will put an end to $1 milk

September 2016          Senate inquiry into dairy industry announced

October 2016             Treasurer Scott Morrison instructed the ACCC to hold an inquiry into the competitiveness of prices, trading practices and the supply chain in the Australian dairy industry.

August 2017                Senate committee report released

November 2017          Consultant chosen to deliver milk price index

November 2017          ACCC Interim report

December 2017           Milk price index consultant sacked

March 2018                 UDV opposes mandatory code

April 2018                   ACCC final report

May 2018                    Milk price index due “mid year”

May 2018                     ADF: “we cannot make a snap decision” on mandatory code

June 2018                     Minister Littleproud: no timeframe for decision on mandatory code “will investigate thoroughly”

So, after all this, where are we today, just two weeks from a new set of pricing for our milk?:

  • No action on ACCC recommendations
  • No milk price index
  • No opening price from either of the big two processors
  • $1 milk AND $6 cheese, with promise of even lower retail milk prices

No wonder farmers are angry. The can has already been well and truly kicked down the road. The independent umpire has spoken.

After two years of investigation and analysis, what justification do the ADF and Minister Littleproud have for waiting any longer to do their jobs and take decisive action to protect dairy farmers?

9 secret drinking habits of dairy cows

DrinkingCows

Following on from yesterday’s instalment of weird and a little bit gross things about cows’ bellies, I figured you might like another one regarding their drinking habits!

  1. The high producing dairy cow has the greatest water requirement per unit of bodyweight of all land-based mammals.
  2. Cows may consume 30 – 50% of their daily water intake within one hour of milking.
  3. Reported rates of water intake vary from about 4 to 16 litres per minute
  4. Lactating cows need 5 litres of water per kg of dry matter consumed + another 1 litre of water per litre of milk produced + more during hot weather
  5. Cows prefer water between 15OC and 20OC.
  6. The amount of water in a cow varies from 56% of body weight in dry cows to 81% in lactating cows.
  7. Water that’s high in cations can cause milk fever in calving cows
  8. High iron, manganese, or molybdenum content may increase needs for copper, or result in more iron-bacteria problems
  9. Water intake varies markedly between individual cows, and from day to day. Here’s the water consumption of eight cows: WaterConsumption

All these facts come from a Advanced Nutrition in Action course run by Dairy Australia. Only just started and I’m already sucked in by all the fascinating stuff there is to know about feeding cows!

 

5 weird and a little bit gross facts about a cow’s stomachs

Lots of people know that cows digest grass using four different chambers rather than a single stomach but here are some (warning: many of them are a bit gross) weird facts you might not have heard:

  1. A cow can produce up to a litre of gas (CO2 and methane) per minute. She’s not a farter though, she’s a burper!
  2. A cow can produce 150 litres or more of saliva in a day.
  3. The first two chambers – the reticulum and rumen – can hold a whopping 150 to 200 litres of solids and liquid in total.
  4. Actually, we’re not really feeding the cow but the bacteria and protozoa in her rumen, which use fermentation to digest 70–80% of the digestible dry matter in the rumen.
  5. The rumen has a pH of about 6 or 7, so isn’t a true stomach. It’s not until the feed reaches the fourth chamber, the abomasum, that the pH drops to 2 and acid digestion begins. This is the cow’s true stomach.

The Aussie dairy carbon hoofprint

hoofprint

Something of a wet blanket was thrown over the World Milk Day celebrations last week in the form of a story in The Guardian and on the ABC about dairy’s carbon footprint.

Avoiding meat and dairy products is the single biggest way to reduce your environmental impact on the planet, according to the scientists behind the most comprehensive analysis to date of the damage farming does to the planet.
– The Guardian, June 1 2018

The story was based on a study published in the journal Science that was based on almost 40,000 farms in 119 countries.

Being something of a “greenie” myself, I know how much emissions vary depending on how we farm and that was reinforced by a chart in The Guardian’s story. The lightest cheese footprint really is quite light! But where does Aussie dairy sit in the spectrum?

GuardianChart

To learn more, I asked Catherine Phelps of Dairy Australia for answers. Thank you, Cathy, for these incredibly comprehensive answers!

————————————————————————————————————————

MMM: How much does the farm gate carbon footprint for dairy vary around the world?
CP: There is a wide variation in the carbon footprint for dairy.

A 2010 study by the Food and Agriculture Organisation on Greenhouse Gas Emissions (GHG) from the Dairy Sector (2010) reported the highest emissions of about 7.5kg carbon dioxide equivalent per kg of fat and protein corrected milk (FPCM) for sub-Saharan Africa.

The developed regions of the world had the lowest footprints of 1 – 2 kg of carbon dioxide equivalent per kg of FPCM. Asia, North Africa and South America have intermediate levels of emissions.

The Australian dairy industry 2010 carbon footprint study of farm gate GHG emissions reported the average GHG emissions to be 1.1kg of carbon dioxide per kg of FPCM. Per unit of production Australian dairy producers have one of the lowest carbon footprints in the world.

MMM: Why is there such a variation?
CP: Differences in carbon footprints are usually related to the efficiency of the production system, cow genotypes and the quality of the forage.

In arid or humid zones where producers are reliant on native grassland, the quality of the feed is poor and milk production per cow is low. The genotype of dairy breeds best suited to poor quality feed and/or high temperature and humidity is often adversely correlated with milk production efficiency.

The majority of GHG emissions from Australian dairy production systems are methane from enteric fermentation (57%); followed by methane and nitrous oxide from urine and dung (18%).

MMM: What have Australian dairy farmers done to reduce their carbon footprint and how has it changed over time?
CP: Between 1980 and 2010, the Australian dairy industry reduced its carbon footprint per kg of FPCM by 30%.

This reduction is due to improved production efficiencies, examples being better quality pasture and selection of higher genetic merit cows. Enteric methane emissions represent energy losses from the digestive process. Improving feed quality, breeding animals with increased feed conversion efficiency and use of specialist feed additives reduces the amount of energy lost as enteric methane.

Increased adoption of good practice manure and nitrogen fertiliser management is also contributing to the lower carbon footprint.

MMM: Does combining animal farming and cropping have any environmental benefits?
CP: This is not an easy question to answer. The practices implemented by an individual producer are often more important than their type of farming system with respect to environmental impacts.

The argument for mixed farming over specialised livestock or cropping systems is usually based on the assumption that animals can utilise cropping waste, or take advantage of grazing cereals with the outcome being greater productivity per unit of land. In addition, animals contribute nutrients to the soil through manure and pasture can act as a disease break crop and/or soil conditioner.

Whether a mixed farming system is more environmentally beneficial will depend on the management practices being implemented. For example, a zero tillage cropping system may have less impact on water quality and soil health than a mixed farming system with a high proportion of conventional cropping.

A different approach is to identify practices which boost productivity whilst reducing environmental impacts. Some of these will be common across farming systems, others will be relevant to a particular system and its location. For example using a nutrient management plan to inform fertiliser/manure applications and identify and remediate soil constraints will improve soil health and farm profit whilst reducing the risk of nutrient loss regardless of the farming system.

MMM: If Australians adopted a vegan diet, what difference would that make to the area of land needed to sustain us?
CP: Recent research based on the Dutch diet reported carbon emissions could be reduced by approximately 2.9 tonnes/person by eating vegan. However the nutrients lost by avoided animal products would need to be compensated by plant-based products. To obtain the nutrients provided by dairy an individual must eat more fruit and vegetables than the recommended daily portions.

The same research estimated the amount of land needed to produce the extra plant food is equal to the land used by dairy. The carbon emissions from the extra food were similar to dairy. Similar research has not been conducted in Australia.

A US study found the removal of animals from the agricultural system resulted in diets with excess energy that were deficient in essential nutrients. There was potentially a decrease in the area of land required, however to support the nutritional needs of the US population nutritional supplements would be required.

The outcome determined that is a challenge to scale up plant-based diets to meet the nutrient needs of whole populations, due to land availability, soil type and climate.

MMM: Aside from eliminating animal foods, what are the implications of a vegan diet and lifestyle?
CP: When considering the environmental impact of various agricultural products it is important to consider the full nutritional value delivered by different foods. Multiple research papers have found that whilst it is possible to meet essential nutrient requirements through vegan diets this can be a challenge in reality.

Without careful balancing such diets are likely to be deficient in various micro-nutrients and fatty acids including calcium, vitamin A, Vitamin B12 and vitamin D. These nutrient deficiencies can be difficult to manage at a population level. Products like dairy are nutrient dense and an excellent source of many essential micro-nutrients and fatty acids.

There are alternative lifestyle options for reducing individual greenhouse gas emissions that don’t involve a significant change in diet.

For example driving a smaller car, reducing air travel, or sequestering carbon by planting more trees. A passenger on a return flight from Melbourne to London return will be responsible for producing approximately 11.2 tonnes of carbon emissions (https://www.treesforlife.org.au/carbon/calculate-your-impact/ready-use-calculations).

Planting five trees will sequester one tonne of carbon.

person s left hand holding green leaf plant

Photo by Alena Koval on Pexels.com

About the mycoplasma bovis bug in Aus that NZ will kill 150,000 cows to erase

The NZ government announced yesterday that it will cull another 126,000 cows in addition to the 26,000 already slaughtered in an attempt to rid the country of mycoplasma bovis.

The massive cull has already led to heartbreak for Kiwi farmers but NZ’s peak farming body says the anguish is worth it.

“Federated Farmers believes getting rid of this insidious disease is preferable to living with it, for years on end, probably without any compensation available for farmers in future when it does hit and can’t be controlled,” NZ Federated Farmers wrote in a statement.

The bug has been in Australian herds for decades so I’m really grateful to veterinarian Dr Zoe Vogels for her explanation of the M. bovis basics. Thanks Dr Zoe!

MMM: What is Mycoplasma bovis?
ZV: Mycoplasma bovis is a bacteria that likes to live inside cows – generally in the respiratory system and the udder and joints. Infected cows will shed bacteria from mucous membranes and in their milk. It grows slowly and likes special conditions in the lab so can be difficult to diagnose. You might have heard about the bulk milk PCR test: this looks for the DNA of Mycoplasma rather than trying to grow it.

MMM: How common is it in Australia?
ZV:
Mycoplasma’s not super common, but every dairying district would have farms that have had it diagnosed – either at present or in the past.

MMM: How do animals get it?
ZV:
Cows are generally infected during milking time via infected milk on hands, gloves, milking equipment or antibiotic tubes. Where animals have pneumonia and respiratory shedding, close contact/poor air quality will play a role in spread.Calves seem to be most often infected by being fed waste milk that has mycoplasma in it from mastitis cows, but the respiratory spread will also occur.

MMM: What are the symptoms?
ZV:
The signs present differently in different situations, in cows the most common symptoms we’ve seen are mastitis (often multi quarter and non-curing and won’t grow anything on normal lab culture) and swollen joints/limbs. Sometimes cows can have pneumonia or ear infections, some countries report abortions.In calves we generally see joint infections (in multiple joints) and sometimes pneumonia and ear infections.

MMM: Is it treatable?
ZV:
Unfortunately, Mycoplasma doesn’t respond well to antibiotics. Antibiotics such as penicillin work by stopping the formation of a bacteria cell wall during their growth phase and Mycoplasma doesn’t have a cell wall, only a thin surrounding membrane.

how antibiotics work cartoon ZV.jpg

There are some antibiotics that are more likely to be effective, but these don’t always work. Mycoplasma is also able to evade the immune system by camouflaging itself from white blood cells and antibiotics and can form biofilms which also protect it from the immune system and antibiotics.

MMM: What should I do if it affects my farm?
ZV: In the words of the Hitchhikers Guide to the Galaxy, don’t panic!
Sit down with your vet, make sure you get your head around how the disease spreads and set out a plan of action. It is important to work out how prevalent it is in your herd, generally through culturing of clinical mastitis cases.

While you are working this out, you will have to plan how to minimise chance of transmission between cows during milking time (such as rapid detection and segregation of clinical cases). These are the same principles that apply to minimising the spread of other mastitis pathogens such as Staph aureus and Strep ag.

You will also have to minimise the risk of transmission to calves by feeding the lowest risk source of milk, such as milk replacer or pasteurised milk. What option you choose will depend on your own farm’s circumstances.

ADF answers conflict of interest questions

Terry Richardson2lores

Terry Richardson, ADF president

The ACCC’s Mick Keogh has slammed national peak dairy body, Australian Dairy Farmers for inaction, telling The Weekly Times there were “significant issues with funding sources of ADF”.

According to The Weekly Times article, processors give the ADF about $1 million annually, which it says is more than double the funding from farmers.

It quoted Mick Keogh as saying: “The questions raised with us by dairy farmers was the extent that those funding arrangements coloured their (ADF’s) view of a mandatory code.”.

Milk Maid Marian asked ADF president Terry Richardson to answer some questions and is grateful for his responses.

———————-

MMM: How is ADF funded?

TR: As has been widely reported in recent years, ADF receives funding from a number of sources, including State Dairy Farmer Organisations and investment returns.

Processor funding is used to facilitate project work on their behalf.

MMM: What percentage of ADF’s funding comes from processors?

TR: Funding from processors is via a fee-for-service contract in delivering the agreed Australian Dairy Industry Council’s (ADIC) investment plan.

MMM: How has that model and percentage changed over time and why?

TR: Processor funding was introduced in 2014, but since that time this component has substantially declined.

MMM: What involvement does the ADF have with processor communications? Why did a media release from the ADPF come from an ADF email account?

TR: ADF is not involved in ADPF communications. We do not discuss messaging because we do not want to compromise our position as a farmer representative organisation. However, past practice has been that ADPF has access to ADF’s media network.

MMM: What influence does the processor funding have on ADF policy and how do you create a firewall between this funding and the interests of dairy farmers to avoid conflicts?

TR: ADF has a clear mission statement to provide collective representation for dairy farmers. Processors are not involved in any policy decisions made by ADF.

ADF and ADPF operate independently of each other. Processors are entitled to express their views just like anyone else, but their opinions do not affect the representation we give to dairy farmers.

MMM: How will ADF’s funding arrangements change in future?

TR: We urge farmers who are not members of State Dairy Farmer Organisations to join, have their say and influence the policy direction of dairy advocacy.

Thank you very much, Terry, for offering answers to Milk Maid Marian.

ACCC suggests a Sheriff for the Wild West

Imagine you own a small family business with just one product that you may only sell to one customer for the next 12 months.

That same customer sets the price for your product and the terms. It informs you of the quality of your product and any penalties that apply to failures it deems to have been caused by you rather than during its own handling.

The bare facts are that you sell 100 per cent of your highly perishable commodity to this customer but all of that amounts to less than a thousandth of its supply. You are tiny.

Now, imagine that this, your omnipotent customer, makes a decision that unfairly costs you tens of thousands of dollars. What do you do?

You call or write a letter, hoping and praying that this customer does the right thing. But if it doesn’t?

This scenario is reality for Australian dairy farmers and it’s not healthy. It’s almost irrelevant whether the processors are doing the right thing at the moment or not because such an imbalance of power is irresistible. History proves it so.

The industry’s answer has been to develop a voluntary code, which does help to benchmark standards of behaviour but offers no independent umpire, no penalties and no redress for breaches.

The ACCC says that’s not sufficient protection for farmers with so little bargaining power. It wants a mandatory code with an independent umpire and penalties for breaches. I, for one, hope the regulator’s recommendations are implemented sooner rather than later.

Federal agriculture minister David Littleproud doesn’t seem averse, responding to a request for comment from Milk Maid Marian with: “I’m glad farmers’ concerns have been shown to be justified and will go through the ACCC’s report carefully.”.