Milk price index to undergo federal review

milk bottle glassLabor has accused Agriculture Minister David Littleproud of desperation after he launched a review of the federal government’s milk price index.

The index was designed to help producers compare farm gate prices, as well as export prices for cheese, butter, skim milk and whole milk powder, but has copped criticism since it was released in July.

“I’m not convinced the index is working as well as it can for farmers so I want to know if that’s the case and what can be done to make it better,” Littleproud said on Tuesday.

A low-take up rate has been the central criticism of the index, with the department revealing in December just 38 farmers had submitted their data.

“The truth is we need farmers to enter their data into the index in order for it to work well. Obviously, I can’t force them but if there’s something we can do to make that easier, we will,” Littleproud said.

Opposition agriculture spokesman Joel Fitzgibbon said farmers were angry he dismissed Labor’s pledge to pursue a minimum farm gate milk price.

“Their frustration has left him scrambling,” Fitzgibbon said.

He said government intervention was needed to help dairy farmers grappling with market pressures, adding Labor supported improving the index.

“Our plan to fast-track a mandatory code of conduct and to ask the ACCC to investigate a minimum farm gate price for farmers is providing dairy farmers with real hope for the first time in many years.”

Littleproud has rejected the opposition’s plan, arguing “going back in time” to a regulated marketplace won’t help.

The review will look at the index’s first six months to determine how well it delivers price transparency and helps farmers understand market signals.

It will also examine producers’ understanding of the index, with the findings due to be released after Easter.

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