Suppliers of Saputo Dairy Australia have welcomed a 20 cent step up in milk prices, saying it builds confidence.
The Canadian company announced it was stepping up its farmgate milk price suppliers of Warrnambool Cheese and Butter (WCB) and Saputo Dairy Australia (SDA) suppliers, in the southern milk region.
“This payment is retrospective and applies to all qualifying milk supplied by current WCB and SDA suppliers from 1 July 2018,” SDA chief operating officer Kai Bockmann said.
“The payment will be made with September 2018 proceeds, during October.
“This increases our average farmgate milk price for the 2018/19 season for suppliers to $5.95 a kilogram/milk solids, up from $5.75kg/MS.”
Mr Bockmann said the increase reflected the impact of a weaker Australian dollar, despite a decline across all dairy commodities in recent months.
“It is not connected to recent developments in relation to the dairy levy proposed by the (Federal) Agriculture Minister, although we hope the increased price will provide some assistance to those impacted by continued drought conditions and higher feed and water costs.”
Mr Bockmann said the company acknowledged the challenges caused by the current conditions.
Peter Young, Buffalo, said high grain prices were starting to hit, although his property was currently waterlogged.
“I need it to dry out soon, because the grain price is going through the roof.”
He said he was currently milking a herd of 300 but might cut it back to 270 to 280.
“It just puts a bit more confidence out there,” Mr Young said.
“There were a few rumblings about a low opening price, but the way Saputo was talking it was always going to be a work in progress,” Mr Young said.
“I’ve been through two price drops, since I took over the farm.
“In discussions with other people, I said we don’t need another drop – I can work with what I know, but you can’t do anything about a price drop.”
Share farmer Dave Weel, Simpson, said he believed Saputo had brought forward a step-up, pencilled in for next month.
“They had to,” he said.
He said the region had a good growing year.
“It was a bit late in autumn, when it started, but its been kind to us now,” he said.
“In the past we haven’t had rain, so I hope we get a nice silage season and it doesn’t cut off, like it did last year.”
He agreed grain was the biggest cost in feeding the 160 strong herd.
Mr Weel said he was paying $535 a tonne for grain.
“You see that and say, ‘gee, something has to give’ but if the weather is kind, and I can get to Christmas and don’t have to feed out for a month more, that’s tonnes we can use at the other end of the season,” he said.
Yarram dairy farmer Ian MacAulay said the step-up was welcome.
“At this time, farmers are pretty much from the high cost of power, water and all those things, so it’s a welcome boost,” Mr MacAulay said.
“It’s not the be-all and end-all but it gives a bit of confidence.”
Andrew Miller
I'm a general reporter with Stock & Land, with a special interest in irrigation issues. I completed my cadetship, with the Age, in 1980. Over my career, I've worked for ABC radio news (Mt Isa, Qld) and at provincial and suburban newspapers.
I'm a general reporter with Stock & Land, with a special interest in irrigation issues. I completed my cadetship, with the Age, in 1980. Over my career, I've worked for ABC radio news (Mt Isa, Qld) and at provincial and suburban newspapers.
