Tuesday, 08 March 2011 13:35

Ag Minister Ludwig must get hands dirty

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FEDERAL AGRICULTURE Minister Joe Ludwig is naive.

Everybody involved in the milk industry, with the notable exception of Coles, says milk price cuts initiated by the supermarket chain are unsustainable.

Those suppliers and small business owners who have already suffered at the hands of the two giant supermarkets know that these cuts will be passed on soon.

National Foods lost out on supplying Woolworths in the northern states last year because the supermarket went with a cheaper option. Reduced prices were offered to farmers as a result.

Talks between National Foods and farmer-owned co-operative Dairy Farmers have broken down since the Coles decision, as Dairy Farmers chairman Ian Zandstra is concerned about the impact on negotiations.

Zandstra is under no illusion as to who will suffer in the milk price war.

However, it seems everyone in the industry is getting worked up over nothing, according to Senator Ludwig – who has taken an assurance from Coles to heart.

“I’ve got assurances that I’ve received from Coles, specifically from the merchandising director,” he told the press.

“It’s worth just quoting it: `Coles is not reducing its prices to its milk processor, so this move will not impact them or the dairy farmers who supply them’.”

“Lower milk prices should not be reflected in a lower farm price - and of course I’ve got assurances that I’ve received from Coles.”

Farmers deserve an assurance from Ludwig that he will roll up the sleeves and dig deeper. He should talk to those who are concerned and not brush these concerns aside because of a letter he has received from Coles.

There are submissions and Hansard statements from the last Senate inquiry that give insiders’ accounts into how the two major supermarkets sell house brand milk at a loss to corner the market.

There are even recommendations from this inquiry, tabled in Parliament less than 12 months ago, that Senator Ludwig and the Labor Party could act on if they wanted to.

The Senate Economics Committee will investigate the milk price cuts, but dairy farmers are rolling their eyes.

Another inquiry – another set of recommendations that will be ignored.

Farmers know the supermarkets do not act in their favour. The last Senate Inquiry confirmed this – but its recommendations that could have helped have been ignored.

The Greens tabled a motion to reinstate the anti-price discrimination provisions in the Competition and Consumer Act, as recommended in the recent inquiry, but it was voted down by the Government and the Coalition.

Senator Ludwig – will you act in the best interests of farmers now?

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