Fed-up dairy farmer predicts demise of Aussie milk
KYOGLE dairy farmer Shane Hickey, whose Facebook video on the plight of his drought-stricken dairy went viral this week, has predicted Australia will soon become a net importer of dairy products.
"It won't be long before there are milk shortages... we're already importing 100,000 tonnes of product into Australia, that is going to increase dramatically," he said.
"In five years we will definitely be a net importer of dairy products.
"There is not many people of my generation that want to do it, we don't want to work the long hours, and the older generations are at that point, there is possibly two out of three that want to close down."
He said farmers were "stressed to the max, mentally and physically".
He has put the blame fairly and squarely on the supermarket chains - a familiar story for most Australians.
He laughed out loud when asked why the Australia Competition and Consumer Commission concluded that said supermarkets aren't to blame following an inquiry in May.
The ACCC instead found farmers had a weak bargaining position with processors, such as dairy giants Parmalat and Saputo.
But Mr Hickey said the problem started with the unreasonable demands for cheap milk by the supermarkets in the face of rising costs, from electricity, to insurance, to feed. That doesn't even take into account the short-term crisis of the drought.
"I had a meeting with a milk company... if you talk to the milk manager, and you see the look on his face when you mention the negotiation with Coles, you see pure fear.
"Because some of these supermarkets control a third of their sales.
"So if you lose 30 per cent of your income overnight as a milk factory... you're screwed... you're stuffed."
Mr Hickey said he heard a story about a major supermarket which put out a tender for their private label milk and a major processor "didn't want to tender for it because they didn't have enough milk for their branded product".
"(The supermarket) turned around and said to them, you have to put your tender in... or we're pulling products of yours off the shelves."
He said that was to give the appearance of competitive tenders.
"They won't write it down, they won't say it on an email, but they will walk up to the factory door and say it to the manager's face and threaten them.
"The ACCC doesn't see all this crap.
"The only way the processors can cut costs to meet the supermarket's demand is cutting what they pay farmers."
Mr Hickey said 20 years ago farmers in Queensland were getting around 58c a litre. Now one major processor, Parmalat, was offering 52c.
"I'm talking to a lot of farmers and they're not game to say anything because they're terrified," he said.
He said smaller processors liks Norco were concerned if they put their price up they would lose market share.
He said he hoped the viral response to his Facebook video would help raise awareness about the problems.
"Perception is a huge thing and these companies revolve around that and I think... the response I've got it's going to put pressure on them to change."