Disillusioned dairy

Even though dairy prices were flying high when I took over the reins here as the hopeful but heavily indebted next generation in 2008, the Global Financial Crisis was already forming.

I could see the international commodity prices were going into freefall but, as late as October, our factory rep said there was no need to worry, our milk price wasn’t affected.

A few weeks later, as farmers were congregating for Christmas parties, the announcement came that our milk price could no longer defy gravity. From February, it would be 40 per cent lower. It was the first time the price had dropped like that in more than 30 years.

The entire industry kicked into action. Dairy Australia offered information sessions on budgeting and cost control measures while bankers rushed to refinance loans. I was impressed. It was a crisis but we all pulled together.

The fallout from the 2016 dairy crisis is different. There’s been the same flurry of post-crisis activity from Dairy Australia and the bankers but farmers want more than that and, two years later, we have not “moved on” like we did last time.

This morning, I woke to a flurry of activity on Twitter provoked by an opinion piece in The Weekly Times by farm consultant, John Mulvany.

John takes the lash to processors and farmer representative body, the UDV, saying both know there are big problems but are refusing to act.

“If nothing happens the industry will continue to decline and cost of production will rise. The lack of action by those who can create change is ‘underwhelming’.”
John Mulvany, The Weekly Times

I agree with John entirely, to this point but he loses me in the following and final sentences:

“They know they can achieve a better industry. But their short-term vision and focus on career paths have created a roadblock.”

I think that’s unfair and missing the real problem. The farmers who volunteer their time to make things happen are routinely rewarded for their efforts by getting slammed relentlessly on social media. Some of it gets pretty personal, too.

As one active volunteer and farmer, Lauren Peterson, tweeted, “…some of us haven’t given up but will if keep tearing us down. We’re not the enemy”.

The real problem is that, unless you’re one of the sheltered few already in some form of life-raft, it’s every man (and woman) for himself now. Not enough of us believe that change is even possible. We are too hurt, afraid and angry.

I’m not blaming anyone for that – I often feel much the same – but it’s hardly the mindset needed for cooperation, negotiation and innovation.

Ironically, processors fighting for our milk are unlikely to provide the leadership needed in case it’s not well received and they lose supply. Much safer to work behind the scenes recruiting key supply with special deals and locking in the masses with sign-on incentives.

What will be the circuit breaker?

Spreading the love at Easter

Parade.jpg

Easter around here is beautiful. It’s a time when you get to see, in one glorious street parade, many of the selfless people who make our district tick.

Every Easter Saturday since I was in nappies, the town has stopped to watch the SES, CFA, Surf Lifesaving Club and a gazillion other volunteers do a hero’s turn around the Canary Island Palms that grace the length of the main street.

Actually, pretty much any sober community member is welcome to participate and they do. We waved to senior citizens rolling along on their mobility scooters, children on tinsel-festooned cattle-trucks-cum-floats, a small contingent of electric cars trailing a “The future is electric” banner and even a colossal black horse prancing anxiously as the Caledonian Pipe Band wailed behind him.

It’s a reminder of the diversity of a town so small that your own geneaology is public knowledge.

It’s the kind of event where you recognise people your father knew and introduce your own children to old friends in the same way your parents once did.

The theme of this year’s parade may have been “Wings” but it only served to remind me of our roots.

The unseen farm support crew

Wayne is one of those rather colourful yet very black and white people but, the other day, he sounded peculiarly uncertain.

“I’ve got a problem with the irrigator,” he said. “Maybe you should come and have a look.”

We’ve worked through more than our fair share of problems with irrigation in the last year.  Pipes blowing apart, toppling hydrants, underground leaks, you name it – one disaster after another – so just the mention of another drama had my blood pressure rising. I pressed Wayne for more details.

“It’s on a tilt,” he said. “Okay, don’t come and look then!” he blustered.

I figured I’d really better come and take a look.

IrrigatorWonkyLoRes

After uncoupling it from the hydrant, Wayne had been towing the irrigator away to another paddock when a wheel found the softer earth over the original trench and buried itself. You might be able to see the tyre tread just below the blue strut on the right hand side.

IrrigatorWonkyTyreLoRes

The pair of us eyed the situation warily. The irrigator had two lifting points on each side. Was this the time to call the neighbours and see if we could get a posse of tractors to round up the wily wheely waterer?

On the other hand, the irrigator is one of the most expensive bits of gear on the farm and, with thirsty crops in the paddocks, mangling it didn’t bear thinking about.

Instead, I called the local heating and plumbing service, which also happens to install power poles.

The following day, a white knight in the form of Eddy the crane truck operator arrived.

In about two minutes flat (and safely further away from the power lines than it looks on the video), he had the irrigator back on solid land, albeit still looking a little saggy thanks to a popped tyre.

“We’ll have that off and into  town pronto,” Wayne crowed with a heady mix of relief and triumph.

It turned out none of our jacks were strong enough to support the 2.5 tonne whirly gig. Cue, another distress call, this time to the tyre service.

It just went to show that no matter how self-reliant we like to fancy ourselves, keeping the wheels turning on farm relies on a squadron of support people.

So, this Christmas, we owe a big dose of gratitude to all the townies we rely on to get the milk into the tanker. Just looking through our accounts, we have all these people to thank this year:

  • agronomist
  • crop and harvest contractors
  • quarry and earthmovers
  • stockfeed supplier
  • hay supplier
  • breeding experts
  • vets
  • herd testing
  • mechanics
  • auto electrician
  • electrician
  • hardware supplies
  • bankers, insurers and accountants
  • dairy technicians
  • dairy hygienists
  • refrigeration mechanics
  • metal fabricators
  • plumbers
  • rubbish removal
  • milk processor
  • stock agents

It’s a big list that removes any doubt regarding just how many jobs dairy farms generate off farm and still doesn’t include all the people we employ via levies and taxes, like the Dairy Australia and Agriculture Victoria brains trust.

Thank you to every single one of you who’ve helped us make 2017 a success.

 

 

Don’t call me a “female farmer”

I’m just a farmer. Not an “invisible farmer”, not a “woman in ag”, just a farmer. Being able to prime a pump and drain a sump does not make me exceptional either. Just another farmer.

I’m not sure, really, why there are so many women-in-ag groups. Their existence suggests the female form is somehow a problem when it comes to twisting wire into a figure 8 knot or developing a new plot. It’s not.

All my life, I’ve watched women farmers at work. My grandmother, mother, neighbours and friends. There’s nothing new – or second-rate – about female farmers.

Nor does being capable with my hands make me any less of a woman. I can totter in stillettos and slosh around in Skellerups. Big deal. So do thousands of other farmers.

Yet today is the International Day of Rural Women and, this week, the Melbourne Museum opened a display it says is the first official documentation of women’s contribution to Australian agriculture.

What am I missing? Why do women flock to special female-only groups and why do so few of us turn up to broader industry events?

What do you think? Are female-only ag forums important to make women feel comfortable expressing ourselves or do they simply reinforce a perception that we’re somehow not able to perform in mixed company?

I’m just not sure.

RUOK day and the SSM test for people like me

SSM

I tweeted yesterday that I had voted “yes” for same sex marriage because who others love is none of my business.

I am sure of that but I made the mistake of thinking the same sex marriage survey was all about LGTBI people. A call from another Gippsland dairy farmer set me straight. It’s about us.

Like gay and lesbian couples, dairy farmers are a minority group. When $1 milk arrived in 2011, I started this blog, frustrated that few Australians seemed to understand why it mattered; why we deserved a fair go.

But there is a difference. The bullying, abuse and vicious attacks LGBTI people often endure is foreign to me. On the contrary, ordinary Australians with no connection to farming whatsoever put their hands in their pockets to buy branded milk during the dairy crisis. Because they understood that everyone deserves a fair go.

The impact of the dairy crisis lingers but, today on RUOK Day, yes, I am okay. And, for that, I owe something to the support of everyday Australians who showed they cared.

The SSM survey cannot test the validity of anyone’s love. It is a test for ordinary Australians like me who expect a fair go. Will we rise to the challenge and return same the respect and tolerance for others that we demand for ourselves?

 

Code of conduct vs contracts

CoC

The newly released Code of Practice has been promoted as industry working together to restore trust and confidence. It’s a step in the right direction but, as it stands, the Code brings little comfort for three reasons:

  1. Apart from a few tweaks around the edges, it preserves the status quo;
  2. Other than being labelled “very naughty”, there are no penalties for flaunting it; and
  3. It doesn’t apply anyway when processors demand new suppliers sign an individual contract. Easy!

Welcome improvements achieved by the code
Don’t get me wrong: the tweaks achieved by the code are welcome and important, especially these:

  • “Any downward changes to such adjustments (or adjustment calculations) cannot be made unless the dairy farmer has been given 30 days’ written notice…”
    In the heat of May 2016, Fonterra initially gave us minus 5 days’ notice. Thirty days would have allowed farmers to make better decisions under far less pressure.
  • “A farmer is entitled to all accrued loyalty and other payments where they have supplied to the end of a contract term, irrespective of whether they remain a supplier post a contract expiry.”
    This will make a difference because, while it effectively continues to reinforce at least a one-year term, farmers are free to switch processors afterwards without missing out on payments that could otherwise take months to arrive.
  • “Where a farmer has a contract with a processor and wishes to expand their production and a processor does not want to purchase the additional milk under the same contractual terms and conditions, the contract between the farmer and processor must allow the dairy farmer to supply the additional milk to other processors.
    This clause will apply if the primary processor is prepared to take milk in addition to the contracted volume at a lower price.”
    This aims to prevent the dreadful Tier 1 vs Tier 2 milk situation seen in fresh milk states like NSW for those on standard form contracts.

Sadly, none of this will stop a savage price drop again and farmers are still pretty much forced to sell all their milk to a single customer for a full year without any guarantee of the price they will be paid.

It’s sad but true that, even with the improvements made by the Code, dairy farmers are at a horrendously unfair disadvantage to the processors who buy our milk.

A Code with no bite
The first thing I should say is that it is clearly not within the power of dairy farmer representatives to mandate this Code. Only our politicians can make laws.

It does mean, though, the that Code is something of a toothless, arthritic tabby at best. In fact, the worst that can happen to any processor who breaches the code is that suppliers can leave (if they can find new homes for their milk) and the processor is labelled a very naughty boy.

Frankly, the shameless behaviour on display over the past 18 months shows it’s pretty clear plenty of processors don’t give a damn what we think of them.

In a piece published by the Stock & Land, UDV President Adam Jenkins said:

“But it’s up to us, as dairy farmers, to take ownership and hold the processors to honouring all the provisions.”

Sounds great. Unfortunately, we just don’t have the power to do that. After all, that’s why a Code was developed in the first place!

Code vs contracts
The Code only applies to “standard form contracts” (those which are the same or similar for all suppliers) rather than the increasingly-common individual contracts.

Burra Foods CEO Grant Crothers spells it out neatly for suppliers in his June 27 blog post:

Mr Crothers is on record now saying that his contracts comply with the Code. I’m not a lawyer, so I can’t comment on whether the clause below contravenes the Code’s insistence that “…no changes should ever be made retrospectively…” but can well understand why some dairy farmers are concerned it does.

Burra42.jpg

At any rate, simply moving from standard form to individual contracts provides an easy work around for processors not keen on meeting the terms of the Code.

The Code provides a starting point
While the Code is not the solution to all our woes, at least we now have a list of basic expectations regarding the way processors treat farmers. But I couldn’t put it better than Adam Jenkins himself, when he wrote: “…while the code is in itself a great achievement of the dairy industry, the real challenge will be ensuring that it is enforced”.

The Code is a foundation for other measures that will restore confidence to invest. Let’s hope there’s another few rounds in the locker to come.

 

Dairy Australia directors need to roll up their sleeves

daemail

It’s sad to say but, clearly, Dairy Australia is scared of farmers.

I returned from a few hours in the paddocks to find screens and screens full of comments on Twitter from fellow farmers on the leaked DA email above.

It’s been explosive because DA is accused of protecting its own turf first rather than being transparent with and accountable to the farmers it serves and who pay compulsory levies to fund its operation.

Contrary to Barnaby Joyce’s wishful pronouncements, farmers are still in a world of pain and the DA levies amount to tens of thousands of dollars per year for many of us. It’s no surprise then, that the way DA spends farmer funds is highly scrutinised.

I’m a believer in the work DA does. The knowledge I’ve gained from DA programs has made an enormous difference to our farm and we’d be a lot worse off without it. But not everyone agrees.

Some farmers are even pushing hard for a halt to the DA levy, irate that the opportunity for a routine poll on whether the levy should be maintained, changed or scrapped altogether was passed up by a committee.

That committee had farmer members and the DA board has farmer members, too. You might think that something run by farmers for farmers would be great at communicating with farmers, but it’s not.

I’m embarrassed to say that, until I Googled them, I couldn’t even recall the names of DA’s long-standing farmer directors. And there are only one or two visible DA HQ staffers on Twitter. While DA maintains its silence, it’s hard to understand how it can accuse upset farmers of spreading misinformation.

It’s time DA’s farmer directors rolled up their shirt sleeves and had frank conversations right from the start. There was a time we had a director on Twitter who knew how to take the sting out of almost any issue by being ready to chat, quick to crack a joke and unfailingly real.

DA can never control the message but, if it wants farmer respect and understanding, it must first join the conversation.

Dairy love and why it’s lacking on St Valentine’s

“Imagine you decided to stay and defend your home from a bushfire, while your neighbour flees.”

“You save your home but the mental scars are deep.”

“Your neighbour’s place is burnt to the ground and sympathy floods in for the family and, in time, they move into a beautiful new home.”

This was the scenario clinical psychologist Rob Gordon put to me explaining why rifts often open in any community after a disaster. He pointed out that because everyone’s experience of a disaster is different, misunderstanding and resentment brew under the pressure of recovery.

I’ve seen it in dairy social media forums. While thousands of farmers are finding ways to support each other on forums like the Show Some Dairy Love Facebook page, there are some cranksters out there who need to kick heads.

I’ve felt the heat of that anger first-hand, ironically from a non-farmer, who says I was one of those with a secretive “special deal” shielded from the infamous claw-back, accusing me of having no morals.

The truth is that, in May 2015, I had chosen to sign up for one of Fonterra’s “risk management products” available to all suppliers. It meant the price for 70 per cent of our milk during the 15/16 financial year bobbed about in a range with upper and lower limits.

Sure, we would have missed out badly if prices did get to MG’s much-vaunted $6.05kgMS forecast close but it felt like good insurance.

When Fonterra cut its price in May 2016, the price for 70 per cent of our milk dropped to its floor. The remaining 30 per cent tumbled the whole way down.

Lots of people were much worse off than we were. Others were much better off.

That’s the thing. Just like a bushfire, the milk crisis has affected everyone differently. So many factors come into play, like:

  • the size of your farm,
  • the time of year your cows calve,
  • which processor your farm supplies,
  • whether you have/had a contract, and
  • which stage your business is at.

On top of all this, there is loyalty and trust.

Hundreds of farmers swapped processors for the first time in years or decades. For many, it was a matter of survival. Others have not been able to switch and some consider leaving the last big co-op nothing short of treacherous desertion.

Add to all this that farmers have now been battling to pay bills for 10 months (actually, a lot longer if you were in one of the drought-affected regions) and it’s not surprising that people are feeling rather cranky, to say the least.

To make matters worse, change for the better seems an aeon away. The senate, ACCC and ASIC inquiries have revealed little to date, other than that the unrepentant Helou had not been interrogated.

I’m spending St Valentine’s Day at the Gippsland ACCC farmers’ forum. I hope that out of this comes a bit of the dairy love we all need.

 

 

Farmers finally get our chance

accc

A once in a lifetime opportunity to sort out the whole damn dairy mess we’ve all taken for granted for so long is coming to town. The ACCC wants to meet you, dear dairy farmer. Not the men in suits – you. If you can’t get to one of the forums or find the time to write an email, that’s okay because they’ll even take calls from the tractor cab on 03 9290 1997. Just do it.

Why? After last year’s debacle, we shouted from the rooftops that the system stank. For once, people listened. Average Aussies dug deeper at the supermarket to help us. And, now, the regulator is asking us exactly what the problem is and what needs to change. We can’t fall silent now. Would anyone ever take us seriously again?

We deserve a system where:

  • the risk in the supply chain is shared fairly by processors and farmers;
  • the farmer is free to sell his or her milk based purely on its virtues on an open market;
  • processors act independently of their competitors;
  • there is trust and transparency in all dealings; and
  • farms big and small are treated fairly.

This stuff is pretty basic in other industries and it’s far bigger than the behaviour of MG and Fonterra (the regulator is looking into that separately). It’s about the way the entire dairy sector ticks and how we are paid for our milk.

It may just be the closest we will get to spelling out and solving the problems that ruined lives. Don’t let others decide our futures. This time, the ACCC means business  but it needs your input.

The ACCC dairy forums will be held at:

  • Monday 6 February 2017 – Toowoomba, Qld
  • Tuesday 7 February 2017, 12pm–2pm – Club West, Taree, NSW
  • Tuesday 14 February 2017– Traralgon, Vic
  • Monday 27 February 2017 – Warrnambool, Vic
  • Tuesday 28 February 2017 – Shepparton, Vic
  • Thursday 16 March 2017 – Bunbury, WA
  • Monday 20 March 2017 – Hahndorf, SA
  • Wednesday 22 March 2017 – Burnie, Tas

Go if you can, email dairyinquiry@accc.gov.au or call 03 9290 1997 and ask for Amy Bellhouse. All the details are at the ACCC dairy inquiry website.

We’re all in this together

SilkyOak.jpg

“We’re all in this together” was the message on the invitation. How true.

So, on Saturday night, around 200 locals enjoyed a “Night on the Green” sponsored by the UDV. As the kids romped on jumping castles or chased each other with balloon swords, the grown-ups took the chance to unwind and regroup after a torrid 18 months. And it didn’t matter where you send your milk.

Among the farmers at the Night on the Green were Paul and Lisa Mumford, who just days earlier had opened their farm, their books and their hearts to visitors. The pair are well-respected and volunteering to make their business a Focus Farm brings a level of scrutiny most would find daunting: everything is on show, right down to their most revealing financials.

The husband and wife team were in equal parts honest, humble and inspiring as they answered questions about their aspirations and challenges. We’ll all learn a lot from Paul and Lisa because they’re so generous with their knowledge.

And, on Sunday, a group of about 10 local Landcarer friends spent a morning doing something for one of our own. Kaye is my Landcare heroine. For years now, she has been the backbone of our group, giving away thousands of trees and coordinating our mob of volunteers to great effect. A long bout of illness meant Kaye’s magnificent garden needed a tidy up. What an opportunity to show her we cared!

This is what community is all about. We’re all in this together! Merry Christmas!