Coles and Aldi urged to follow Woolies’ milk move

Dairy farmers are hailing supermarket juggernaut Woolworths’ decision to abandon its $1-a-litre milk offer as the first step towards restoring long-term pricing confidence within the struggling industry.

However, they warn more industry-wide support from major retailers Coles and Aldi is needed to ensure dairy operations remain afloat.

Woolworths ended the controversial $1-per-litre deal for its branded milk products nationwide on Tuesday, now selling its 2-litre and 3-litre varieties of fresh milk for $2.20 and $3.30 respectively.

The grocery giant will continue selling its one-litre milk cartons for $1.20.

Woolworths promises “every cent of the increase will end up with Australian dairy farmers”, after an eight-year industry plea for Australia’s supermarkets to abolish the $1-per-litre milk pricing.

It is expected dairy farmers contracted with Brownes will receive 2¢ a litre more.

Witchcliffe milk producer Miles Mottershead praised Woolworths for advancing industry reform.

It comes after the second-generation South West dairy farmer and wife Dione celebrated 20 years of marriage last month with their first holiday in nine years, after rising on-farm pressure restricted the couple from enjoying leisure time.

Mr Mottershead, who has a herd of 500 milkers, said it was an important announcement and encouraged milk processors to pass on price increases to ensure “undervalued” dairy farmers were operable.

“It’s the first step because the $1-a-litre was slowly killing the whole industry,” he said.

“We need the processing companies to put the price increase through to us to keep us viable.

“Being a dairy farmer is one of the most complicated industries to be involved in and at the moment we are undervalued.”

Cowaramup dairy farmer Bob Biddulph also welcomed Woolworths’ announcement, while increasing pressure on Coles and Aldi to also cut $1-per-litre milk.

“The cost price squeeze is really pinching us all at the moment and it was difficult to see where an improvement would occur,” he said.

“This is good news, it is a positive step, and we are hoping it will translate into a better milk price.

“Now we need Coles and Aldi to also remove the $1-a-litre milk.”

The State’s dairy farmers have endured a crippling 12 months, battling increased feed costs on the back of the Eastern States drought alongside dry seasonal conditions.

Forest Grove milk supplier Ian Noakes echoed Mr Mottershead and Mr Biddulph and said the $1-per-litre milk deal had severely impacted WA milk suppliers.

“Woolworths’ decision is a breakthrough... it really is a long time coming,” he said.

“Hopefully Coles and the rest that sell it follow.”

Milk processor Brownes Dairy is the WA supplier for Woolworths private label milk, while Japanese beverage company Kirin’s subsidiary Lion Dairy supplies Coles.