Norco has taken the unprecedented step of calling on its supporters not to boycott supermarket giant Coles.
Queensland-based dairy farmers called for the boycott yesterday after Coles announced it would not back a 10-cent drought levy to help support struggling farmers.
Dairy farmers in many parts of Australia have found themselves squeezed between the increased cost of production caused by the drought and unrealistically low shelf prices for milk brought about by the supermarket war.
But Norco has reacted by calling on its supporters south of the boarder to keep buying milk from the supermarket.
Norco’s Chairman and Interim CEO Greg McNamara said the co-operative has ‘a great relationship with Coles and we have been proud suppliers of both Norco and Coles brand dairy products for several years’.
‘The supply agreement between Coles and Norco is an important and valued component to Norco’s business and to members as a whole. Coles pays the farmgate price which is set by Norco, plus a processing margin and other manufacturing costs,’ he said.
‘Coles has also supported Norco’s decision to pay our farmers an additional 5c per litre for their milk to assist them in coping with the impact of drought.
‘The intentions of a proposed ten cent per litre levy to be applied to the retail shelf price of milk are honourable, however it is the view of the Norco Board that our members cannot wait and immediate action is required to assist our farmers through this debilitating drought and feed crisis.
‘Calls for a boycott of Coles are misguided and would only hurt our farmers by reducing sales of Norco products, impacting our ability to pay the extra 5c, and would not address the long term challenges facing the industry,’ Mr McNamara said.