Dairy farmers forced to sell up in face of plunging milk prices

On a freezing winter evening, truckload after truckload of dairy cows are delivered to the saleyards at Camperdown in south-western Victoria,many are pedigree cows 
Some arrive in herds. Others are brought in by farmers just two at a time.Kathleen Johnston cried all night after having to sell her ‘babies’
For some farmers, it is the end of dairying
Murray Goulburn: What went wrong
This is prime dairy country and many of the cows arriving are pedigree dairy cows, bred for milking and hand-reared by their dairy farmer owners.
Only yesterday, these cows were lining up at dairies, waiting to be milked.
No longer valued for their milk, but only for their weight in kilograms, at the saleyard they are all called “choppers”, because they are destined for the abattoirs.
This is the grim face of the crisis in the Australian dairy industry, detailed on Four Corners.
It began at the end of April when Australia’s biggest milk processor, Murray Goulburn, slashed the price dairy farmers had been expecting for their milk.
Instead of the $6 a kilogram that farmers had been relying for their milk solids, they were suddenly told they would be getting well under $5 a kilogram.
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To add insult to injury, the farmers themselves would have to pay back the difference, a total of around $200 million between about 2,500 farmers.
It meant many dairy farmers were being paid less for their milk than it cost them to produce it — now, sending prize dairy cows to the saleyards for slaughter is the only way many farmers can pay their bills.
Livestock agent Phil McVilly, who deals with many of the local abattoirs, noticed the impact of the milk price cut almost immediately, with a record number of “chopper” cows being dropped off for sale within days of Murray Goulburn announcing its price cut.
Since the beginning of May, this one yard has been selling around 700 dairy cows a week to the abattoirs, and there is no sign of the sell-off slowing down.
Soon after Murray Goulburn announced its price cut to farmers, New Zealand dairy giant Fonterra cut its prices even further, spreading the pain across the whole industry.

For some farmers, it is the end of dairying
In a few weeks, Kathleen Johnston will be turning out the lights in her dairy for the last time.

She is already fighting back the tears.
Kathleen Johnston cried all night after having to sell her ‘babies’
After spending eight years hand-rearing calves to build up their prime herd, Ms Johnston and her family have made the agonising decision to give up on their dairy farm in Deniliquin in southern NSW.

Murray Goulburn’s price cut this year was bad enough, but the family has also been told that next year they will get even less for their milk; about $4.30 a kilogram.
“The very minute that we got the letter that said that’s what the price is going to be, we decided, ‘no, we can’t keep going like this’, that we would finish up,” Ms Johnston said.

She and her husband called their stock agent straight away.
“[We] made the phone call to the stock agent and said, ‘sell them up’,” she said.
Ms Johnston said she spent that night crying about the decision, and she is still teary.
“Just the thought of selling your babies … you have pets, so that was hard,” she said.
The Johnstons did not have much choice — they farm in tough country.

At the milk price Murray Goulburn is offering, they will not be able to buy the water or fertiliser they need to grow the grass to feed their cows.
They have worked out that they will end up losing about $70,000 a year if they keep dairying.
Ms Johnston said she believed Murray Goulburn could have warned its farmers sooner.
“We’re convinced that they knew about this a year ago, and they were just sitting on it,” she said.

“I don’t know what they thought that our reaction would be, that we would all go, ‘oh, that’s OK, we’ll keep milking for this bulls**t price.”

The Johnstons have already sold off 60 cows and have kept the rest for as long as they can.
Strong opening milk prices mean farmers will be cashed up for Christmas

PHOTO Many dairy farmers have been being paid less for their milk than it costs them to produce it.
ABC: FOUR CORNERS

Ms Johnston has helped many of her cows give birth, watched their calves taking their first steps and given many of them names.
Like many others, she does not feel the companies give much thought to farmers like her family, who face ruin.
“They don’t care about that; they’re only caring about what they’re getting for their managerial money and the money for their office workers,” she said.
“They don’t care that what we’re doing, and we’re just a tiny little fish in this big ocean.”

The Johnston family is dreading the tough weeks ahead.
As Ms Johnston wiped away tears, she said: “I think we’ll walk away feeling empty and quite sad.”

An industry in crisis

Over the last two months, processing companies have been holding meetings with their suppliers in an attempt to hose down the farmers’ fury.

While Murray Goulburn was the first to cut its milk price, Fonterra did not waste time in cutting even harder — their suppliers see it as sheer opportunism.
At a company meeting in south-western Victoria, emotions boiled over.
Lorraine Robertson has driven all the way from South Australia just to come to the meeting, and could not hold back her tears.

Lorraine Robertson says she can’t leave while she owes money
Lorraine Robertson says she can’t leave while she owes money

She has already sold off one truckload of cows and will have to sell more.

“[It] just absolutely breaks my heart, and it should never ever come down to this,” she said.

When asked how much money she received for her milk sales this month, she said: “It’s minus $16,000. That’s the debt to Fonterra. So I can’t leave, even if I did have somewhere else to go.”

http://mobile.abc.net.au/news/2016-08-15/dairy-farmers-forced-to-sell-up-in-face-of-plunging-milk-prices/7730638

2 Comments Add yours

  1. Anne van Popering says:

    It’s even more depressing when at the end of this article there is numbers to call for help from Lifeline, Suicide Call Back Line, Beyond-blue….etc….the government need to step in to support these Dairyfarmers financially……..after all farmers are the backbone of our country…..they should fix up our country’s problems financially before sending millions of $$$$$ overseas……

    Like

  2. Murray Crawford says:

    I remeber when Murray Goulburn took over many of the small factories and immediately broke their promise not to shut them down. Ever since they have been slowly destroying the industry. I hope you go broke too.

    Like

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