Llew O'Brien (Wide Bay, National Party) Share this | Link to this | Hansard source

Australia is in the grip of an unrelenting and unforgiving drought that is wreaking havoc on farmers and destroying their livelihoods. Australian dairy farmers are also in the grip of an unrelenting and unforgiving price war being waged by the supermarket giants, Coles and Woolworths, that is also destroying their lifestyles and livelihoods. The Australian government is providing $576 million in assistance to drought-affected farmers, and we have indicated that more support is on its way. I commend Minister David Littleproud in doing this fine job, but my dairy farmers remain in Coles' and Woolworths' vice-like grip, which is getting tighter and tighter as these supermarket giants squeeze every last cent out of the dairy supply chain.

When it comes to the dairy industry, Coles' 'Down, down' slogan applies equally to Woolworths, with both supermarket giants hitting dairy farmers 'down, down' as far as they can go until they're out of existence. Coles and Woolworths are squeezing Queensland's dairy industry to death, killing off locally produced fresh milk, and they will ultimately make consumers in our state rely on long-life and powdered milk. The Queensland Dairyfarmers' Organisation estimates that, since the Coles and Woolworths dollar milk pricing started, dairy farmers have been squeezed out of the industry in droves, with the number of Queensland dairy farmers plummeting from 566 to 380. Milk production has been cut by 3.1 per cent between 2012 and 2017, and now around 160 megalitres of milk is imported into Queensland to meet demand.

And this strangling grip is having a devastating effect on the wellbeing of the farmers themselves, with many reports of mental stress and suicide being caused by the financial stress that Coles' and Woolworths' dollar milk pricing is inflicting on the dairy industry. If the supermarket giants don't ease this squeeze on the dairy industry, charge a fair price for milk, inject money into the supply chain and ensure that farmers are paid a fair price for their product, there should be a revolt against their tyrannical conduct. I believe in the market, but, where the market fails—and I believe the supermarket giants are well and truly failing dairy farmers—the government must force these market manipulators to play fair. Where is the fairness with Coles and Woolworths selling a litre of milk for $1 today—the same price for which they sold milk in 2011 when they started the dollar milk price war on Australia Day? I can't think of anything more un-Australian than the devastating impact that Coles' and Woolworths' milk price war is having on the dairy farmers.

The supermarket giants forced down the price of dairy farmers' produce when they started selling dollar milk, and they've kept the price down ever since. In real terms, farmers have faced cuts to the price of their milk year on year ever since it started. How can they have us believe that a dollar in 2018 is worth the same as it was in 2011? With inflation, a litre of discounted milk that sold for $1 in 2011 should now be selling for around $1.16, at least. And the milk supply chain is getting squeezed further. Now I'm hearing from dairy farmers that, due to Coles further squeezing the price through the processor, the protein content in their milk has been devalued in upcoming contracts. This will further diminish the value of their product and just shows how low the supermarket giants will go. After seven years of dollar milk, the time has well and truly passed for it to end.

I was extremely disappointed by the ACCC's failure to respond to the request from the Queensland dairy industry and take action against Coles and Woolworths, but I note that the ACCC inquiry into the dairy industry recommended the establishment of a mandatory code of conduct. I fully support that recommendation, and I'm working with my colleagues to deliver a mandatory code that extends from the farm gate through the supply chain and into the boardrooms of Coles and Woolworths, making the supermarkets charge a fair price for milk, so the farmers can receive a fair price for their product. After next week, I'll be hosting a dairy roundtable meeting in Gympie with agriculture minister, David Littleproud, and local producers. Taking action against Coles' and Woolworths' dollar milk pricing is at the top of my agenda in Wide Bay.

House adjourned at 20:00