Woolworths cut the price of its home brand milk on Sunday, September 22, claiming it was passing on savings from its processor.
Coles and Aldi reduced their prices within the next 10 days, leaving prices at their lowest level in 13 years.
In 2011, Coles cut the price of its home brand milk to $1 per litre, with the other two supermarkets following soon afterwards, escalating the dairy industry’s decline.
Australian Dairy Farmers said on Wednesday, October 9 that a second milk price war had begun.
ADF president Ben Bennett said the price war came at the expense of dairy farmers and processors.
“We all know supermarkets position dairy at the back of the supermarket and discount prices to get consumers in,” ADF president Ben Bennett said.
“They then make the majority of their profits on all the shelves consumers walk past on their way to the dairy section.
“Meanwhile, supermarkets justify their price decrease because processors have opened the season with lower farmgate prices paid to farmers.”
A ten to 15 per cent decline in farmgate income and high input costs have some dairy farmers struggling financially .
“This will only serve to encourage more dairy farmers to leave the industry, which is bad news for all Australians,” Mr Bennett said.
“Australia’s milk production has been declining for the past 20 years, with dairy imports rising over the same period of time.
“It means Australian families will be forced to consume more imported dairy, and with an increasingly limited ability to choose quality Australian products.”
