THE NSW Farmers Association says it is optimistic a move by Coles to deal directly with farmer cooperatives will offer more sustainable returns and certainty to a number of NSW dairy farmers.
The deal brokered between Coles and the dairy co-operatives Murray Goulburn and Norco will see the processers enter into long term contracts to supply Coles brand fresh milk in NSW, Victoria and southern Queensland (see here)
The announcement follows continuous calls from NSW Farmers and others for the major supermarkets to offer a sustainable pricing mechanism for its fresh milk products.
NSW Farmers CEO Matt Brand said the move represented a critical first step and a broader commitment from Coles to invest in the dairy industry.
"It is a good sign that farmer cooperatives are back in the marketplace because this means farmer margins will be optimised and ultimately returned to the farmer as a shareholder," he said.
Mr Brand said Coles indicated that farmers would get a greater share of the retail milk price, however information on the exact prices farmers would get for their milk under these contracts was unknown.
"We acknowledge this move does not apply to all dairy farmers, however if this model is successful we are hopeful that it may be able to be expanded," he said.
Update your news preferences and get the latest news delivered to your inbox.