The big supermarkets have signalled a ceasefire in the milk wars, raising the price of milk above one-dollar-per-litre for the first time in eight years, but one competitor has refused to budge.
Aldi and Coles announced on Wednesday that they would raise the price of milk by 10 cents per litre, following the lead of Woolworths last month, with consumer-friendly low prices having hurt primary producers like dairy farmers.
“I’ve been criticised for asking Australians to boycott supermarkets that weren’t prepared to support the dairy market while I was making reforms and for them now to have yielded is a big step,” federal agriculture minister David Littleproud told TICKY at the Global Food Forum 2019.
Littleproud also insisted that Costco, the last supermarket that refuses to yield on milk prices, be boycotted until it falls into line too.
“[Managing director Patrick Noone] better be snappy, and do it very quickly,” he warned. “I understand Costco were here earlier saying they might do. Well, I’m going to be consistent. I’m going to say to every Australian until they yield and do what the others have done, ‘please consider where you shop’.”
“This is about fairness. These dairy farmers aren’t charities… I think every Australian, who it costs an extra 10 cents per litre, would say that is fair,” he added.
The eight-year price war has taken its toll on farmers amid declining profitability and rocketing production costs, leading this year’s milk production to be forecast to fall to its lowest level in more than two decades.
“This bought some time to keep dairy farmers there. We are now under 9 billion litres of milk [per year] and that’s going south at a rate of knots,” Littleproud said.
“This is about resetting where there’s a market failure. That’s the only time a government should interfere in a marketplace.”
Watch Ticky Fullerton’s full interview with David Littleproud above.