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Aldi extends milk levy following further calls for supermarkets to support farmers

Supermarket Aldi has quickly responded to calls from Federal agriculture minister David Littleproud for supermarkets to extend the temporary 10-cent milk levy.

Aldi Australia confirmed it will be extending the collection of a 10 cents milk levy on all 2-litre and 3-litre fresh milk, which was first introduced in March 2019.

“Aldi has made this decision to ensure we support a strong and sustainable Australian dairy industry while we wait for systemic change.  The findings and recommendations from the 2018 ACCC Dairy Inquiry were clear and as we wait for them to be rolled out, we are happy to support the Government and dairy industry more generally on short term measures that lead to the ongoing sustainability of the industry,” said Oliver Bongardt, managing director of buying, Aldi Australia.

Littleproud told reporters in Canberra on Wednesday that there won’t be enough dairy farmers in this country to continue to supply fresh milk if they are not treated fairly.

“Time’s up now. They did a good job restocking the shelves. But that’s just one thing, that makes them a quid. They’ve got a moral responsibility to make sure we’ve got a dairy industry after COVID-19 and in the future,” Littleproud said, according to AAP.

The deputy Nationals leader blamed dairy processors for stacking the market against local farmers and said he doesn’t want imported fresh milk to act as a band aid to the problem.

Woolworths told Inside FMCG on Thursday that it will be continuing to collect and distribute its existing milk levy.

“We have no plans to make changes to our existing drought levy at this time,” a Woolworths spokesperson said. 

“Since September 2018, our drought levy has contributed an extra A$43.5 million in relief to more than 450 Australian dairy farmers and payments continue to go out each month. On top of the levy, we have agreed to tens of millions in wholesale cost increases from milk processors across the dairy cabinet off the back of rising farmgate milk prices.”

Coles said it is continuing to support dairy farmers through its direct contract model.

“Last year, we introduced a direct contract model for Coles Brand milk in Victoria and central and southern New South Wales which allows us to deal directly with farmers rather than through a processor. This model provides farmers with certainty of income through longer-term contracts and delivers some of the highest farmgate prices in the industry. The arrangement is working well and we’re looking to roll it out more broadly across other states,” a Coles spokesperson told Inside FMCG.

On Monday, dairy advocacy group Dairy Connect urged the government to impose a mandatory dairy levy to support local Australian farmers.

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