The North Coast MP who called for a royal commission into supermarket abuse of power has taken the unusual step of thanking one of them.
Page MP Kevin Hogan (Nationals) has welcomed news that Woolworths will effectively cease sales of $1 milk but says there is still much more to be done.
‘The $1 milk has hurt our local dairy farmers. It is good that Woolworths has decided to end it,’ he said.
‘Selling milk cheaper than water devalues the product and the work farmers put into it.
‘The ACCC report into the dairy industry clearly says supermarkets use their market power to drive down how much they pay processors, and processors then use their bargaining power to drive down what they in turn pay farmers.
‘This is one of the reasons why I have called for a royal commission into the market power of our big supermarkets,’ he said.
The supermarket chain said in its announcement on Monday (February 18) that it will increase its home brand milk prices to $1.10 per litre.
It will also sell two and three litre varieties of Woolworths branded fresh milk for $2.20 and $3.30 respectively, with all of the increase going to Australian dairy farmers.
Game changer: farmers
Woolworths Group CEO Brad Banducci said the company’s ‘drought relief milk payment model has worked on the eastern seaboard and is the most effective way to guarantee price increases end up in the pockets of Australian dairy farmers’.
Australian Dairy Farmers CEO David Inall said,’ There is no doubt that this is a game changer in the fight against discount dairy that has long frustrated the industry.
‘It is reassuring that Woolworths has committed to deliver the full 10 cent increase back to those farmers who supplied the milk into that product category.
‘Removing $1 milk is not just intended to restore farmers’ financial confidence, but it will also boost confidence in regional communities and small businesses that rely on the industry.’
Coles, Aldi won’t match
Coles and Aldi have failed to match Woolworths’ move, although Coles has announced a plan to collect money for drought stricken farmers at its tills.
A spokesperson said, ‘Coles is committed to finding a better model that can be adopted by the industry to assist Australian farmers, and intends to liaise with relevant parties including government and the ACCC.
‘In the meantime, Coles will continue to look at ways to support Australian farmers, including by collecting customer donations at our supermarket registers nationally from Monday 25 February, until further notice. Coles will match these donations dollar for dollar,’ the spokesperson said.