June 4, 2026
If processors don’t increase the prices offered to dairy farmers by early July, many will cut back milk production or even quit the industry, eastAUSmilk president Tim Bale warned on Thursday.
He said all milk processors were required to release their minimum contracts on June 1 every year.
“This year, farmers were hoping for a significant uplift in prices given the recent large increase in fuel, fertiliser and feed costs,” Mr Bale said.
“As a minimum, farmers were hoping for prices to stay the same all of next financial year including the 5c/litre fuel and fertiliser payment. However, most farmers were very disappointed by what they saw on Monday.
“Not one processor committed to maintain current payments for all of next financial year.
“Some offered modest increases in base price, but overall payments were down.
“Some processors didn’t offer any commitment re the 5c increase announced in May. While some processors took away the 5c/litre and also dropped the price further.
“I would encourage all farmers who are off contract to not rush to sign any of the lowball contracts that have been offered.
“Farmers should find out who is chasing milk in their region and get price estimates off all of them. Farmers should not rely on average prices advertised by processors which are very unlikely to be applicable to your farm.
“You should get estimates done on the production on your farm over the past 12 months so you can accurately compare processors. The entire contact along with any fine print should be taken into account, with any questions raised with the processor for clarification.
“Farmers then should negotiate with the highest paying few processors before making any decisions to sign a contract. It is counter productive for any farmer to sign a contract before the end of June and don’t be pressured into doing so.
“If prices do not increase significantly by early July, many farmers will cut back on production and some will exit.
“There is no value in farmers continuing to produce milk at a loss if prices do not adjust to reflect the significant increase in costs. The prices announced by processors clearly indicate that processors want less milk than they currently have.”
