WESTERN Australia’s recently deregulated dairy industry could be gearing for competition following a proposal to establish a second farmer-owned cooperative dairy.
While the proponents admit the finer details are still to be worked through – including the establishment of a proposed negotiation agency – the aim is establish a WA dairy farmer-owned milk supply agency to improve farmers’ profits.
The proposed agency is tipped to shake-up the local processing and retail sector, which is already facing rationalisation because of a plan by Coles and Woolworths to take over the distribution of milk to their supermarkets.
The new cooperative proposal is the work of a group calling itself the Dairy Working Group. A Sydney-based solicitor is developing its structure.
It is also being championed by the WA Farmers Federation.
About half the State’s 300 dairy farmers supply milk to the Capel-based Challenge Dairy cooperative via a tiered pricing structure.
The remaining farmers supply milk directly to selected major dairies through both tiered and single pricing structures.