There is a scene in the film Billy Elliot, towards the end, when Billy's dad descends down the mine. This is the mine he has been fighting to keep open. Defeated by the system, we see him lowered into the drudgery of the pit once more.
At present we are being told to buy more milk and eat more cheese. Dairy farmers are telling us to do this. But at present many of them are being paid the equivalent of 37c a litre when it costs them 38c per litre to produce the stuff. Unless farmers get a subsidy or a payment that is above the cost of production by buying more dairy products in this system we are simply perpetuating the problem.
The system is broken. Farmers are being encouraged by powers within the industry from processors to the government (through agencies like ABARE) to react to positive signs in the market by investing in bigger herds and more modern milking equipment by borrowing from the banks.
When the rest of the world is doing the same thing - the EU removed quotas on dairy production in April 2015 - it is a no win game. When quotas were removed Belgian dairy farmer Yvan Deknudt told the BBC "We're really scared that production is going to explode and we won't be able to pay our costs any more.
“It is a challenge because an entire generation of dairy farmers will have to live under completely new circumstances and volatility will surely accompany them along the road," he said.
The BBC also reported that "the lifting of quotas helps only big food companies and the largest milk producers whose efficiency allows them to operate with slim margins."
With a falling global price for milk Australian farmers cannot turn to the domestic market as expectations have been to lowered rock bottom. One dollar per litre is telling shoppers that milk is cheap, and should be. Water is sold in the same supermarkets for three times this. 55 per cent of milk is sold in supermarkets and 64 per cent is the cheap stuff. That’s 880 000 000 litres of milk sold at $1. Coles did a deal with its private label processor Murray Goulburn that sees Coles pay less the more the global price of milk goes down. So as conditions worsen for MG and its farmer shareholders, the supermarket gets more from this Faustian pact.
Farmers get screwed by bottlenecks in processing, with just a few players in the field and an even greater bottleneck in distribution.
The dairy products the big companies are producing are not something I want to feed my family. Philadelphia Cheese, sugar-filled Yoplait, and Big M. Almost all carton milk has been homogenised, standardised and put through reverse osmosis filtration that sees the milk taken apart and its fat and protein level modified.
My response, and always has been, to buy whole dairy products direct from the producer. Here is a list of examples in no particular order.
- Schulz's Dairy Un homogenised milk.
2. Mungalli Creek Yoghurt - plain
3. Inglenook Dairy Cream Top Milk
4. Jonesey's Milk
5. Myrtleford Butter Factory Butter
6. Australian Organic Dairy Farmer's Butter
7. Locheilan Cheese - Bruce's Blue
8. Demeter Biodynamic Milk
To a list like this I am often confronted with the response "but these products cost so much more."
That is the point...