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General => General Discussion => Topic started by: tryagain on June 01, 2016, 10:39:01 AM
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Instead of sidetracking a different thread I thought I'd start a new one about the about the latest social media hype surrounding the Dairy milk industry and post this video. It's from a few years ago but from my point of view is still very relevant. There is a lot of good sentiment towards dairy farmers that from what I can tell isn't really being directed in the right direction.
! No longer available (http://www.youtube.com/watch?v=IIOvRO8k7uI#)
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Exactly ! When this latest incident happened I heard a dairy farmer say they needed us to drink more milk not neccesarily the dearer stuff.
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I just dont understand how a bottle of water (which is basicly free) costs more than milk.
Wouldnt it be easier to just put a 50c/litre levy on it that goes directly back to farmers, so its out of the grubby corporate hands.
Then it is seperate to world prices bla bla bla.
Maybe Im just a simplton .
Cheers Glen
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This thread is going to be interesting.
First thing is we dont import cows. They are all Australian.
All the milk is from dairy farmers.
Yes some big companies own these dairy farms.
Yes woolies and coles buy their milk from dairy farmers. They then sell them under their own brands at a cheaper price. I have no issue with this. Its called marketing.
Yes there are other brands of milk people can buy.
Everyone one can choose what brand of milk they want.
We can put this scenario to alot more products also.
Mark
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My mate and a few friends all own dairy farms....its tricky..not sure if I should portray their views.we can all watch videos of facts and non facts etc.....but the farmers all agree....buy brand name milk...nuff said
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My mate and a few friends all own dairy farms....its tricky..not sure if I should portray their views.we can all watch videos of facts and non facts etc.....but the farmers all agree....buy brand name milk...nuff said
I would like you to portray their views, there is always two sides to the story and I rather have the full picture if there is something I am missing. I have no doubt they would rather people pay more for milk, I can't think of an industry that wouldn't like people to pay more for their products.
What I don't get is why people think buying brand name milk helps farmers in the short term (which is what the current issue is), the ones who benefit from this, are Colesworth and big OS owned milk producers, the very same companies they blame for screwing over the farmers. Norco and other smaller dairy farmers cooperatives are the ones who haven't slashed prices paid to the farmers, so correct me if I am wrong but as Coles (not sure about woolies) actually buy the $1/L milk here in SEQ from Norco, farmers are actually getting more $/L from the Coles branded milk than from the big OS owned brand names at the moment.
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Coles mostly buys its milk from murray goulbourn in vic. What coles buys is 3% of what mg produce. It mostly all goes overseas
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Unfortunately they do not want their views expressed....its their belief that nothing they say will be helpful as the problem is bigger and deeper than a quick fix...i buy local coop milk...
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Do any of you remember the old milko? you know the bloke that used to deliver your milk to your door. ???
I do, I was one, and to hear dairy farmers whinging I find amusing. I remember attending meetings having dairy farmers telling us the sooner they got rid of milkmen the better it would be, as they thought we made to much profit from their milk. Telling us all we needed was a pair of sand shoes and then made the profit.
Well guess what they got there way, and got rid of us in Qld, snigger snigger, guess what the big supermarkets then had no competition, they now can pay the farmer what they like.
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Haha there's more than two sides to this story
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What I found Most interesting was the social media posts saying buy devondale, etc. who are Murray Goulburn. It was MG who did the dirt act of backdating milk price reductions. It wasn't Coles or Woolies who backdated the price cut, it was Murray Goulburn who are still largely a coop, with some listed shares.
Don't get me wrong it was a dog act to effectively backdate the price cut.
So social media says to support the company who cut the farmers price? Doesn't make sense.
Just Buy more milk , I'll have to start drinking baileys?
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I am an educator working in Agriculture education and as far as I am concerned milk is just the tip of the iceberg. The mining boom is over, the government wants you all to believe that we are to have the innovation boom next and that's where it's at. Tell me what is Damo the dump truck driver who got laid off from his $140000 a year FIFO job, or me for that matter is going to add to the innovation boom? We live in a global economy and as far as I am concerned as a nation we are so far behind the eight ball suggesting that we are going to be the world leaders in innovation and it will provide employment for the masses is just ridiculous. We can't even manufacture anything let alone be innovators. Anyone with half a brain can see the next boom is going to be in primary production, why do you think China is pushing so hard to buy Australian land? If we don't start valuing our agricultural producers and the land they work from, our children are screwed. Australia has the ability to be a major player in world food production over the next century but if we don't wake up and pull our fingers out the boom will happen our land will be used and we won't own one part of it. It seems most people are to short sighted and lazy to make the sort of concerted long term effort that is required to stop this happening but we are apparently smart enough to be innovators!! Start valuing our farmers by purchasing locally produced goods from locally owned stores. Without increasing farm door profits, no farmer can be expected to keep their gates open, employ more workers and purchase the equipment and technology that they are going to need to be world leaders.
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I am an educator working in Agriculture education and as far as I am concerned milk is just the tip of the iceberg. The mining boom is over, the government wants you all to believe that we are to have the innovation boom next and that's where it's at. Tell me what is Damo the dump truck driver who got laid off from his $140000 a year FIFO job, or me for that matter is going to add to the innovation boom? We live in a global economy and as far as I am concerned as a nation we are so far behind the eight ball suggesting that we are going to be the world leaders in innovation and it will provide employment for the masses is just ridiculous. We can't even manufacture anything let alone be innovators. Anyone with half a brain can see the next boom is going to be in primary production, why do you think China is pushing so hard to buy Australian land? If we don't start valuing our agricultural producers and the land they work from, our children are screwed. Australia has the ability to be a major player in world food production over the next century but if we don't wake up and pull our fingers out the boom will happen our land will be used and we won't own one part of it. It seems most people are to short sighted and lazy to make the sort of concerted long term effort that is required to stop this happening but we are apparently smart enough to be innovators!! Start valuing our farmers by purchasing locally produced goods from locally owned stores. Without increasing farm door profits, no farmer can be expected to keep their gates open, employ more workers and purchase the equipment and technology that they are going to need to be world leaders.
I see a flaw in your argument.
Only an incompetent, greedy or corrupt government would allow a foreign nation to buy into their sovereign land.
Oh ....
Wait a minute.
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Call me a pessimist Glenn but I can only see one reason China would want a 90 year lease on Darwin Harbour. Where is all the water and land in Australia and what do you need to grow food :)
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In a nutshell, unfortunately all farming industries have a price set by the market unlike the manufacturing industry that sets a price on the cost of production. The market is driven by a lot of different factors, profit being one of them and they don't really care if the price they give the farmer covers his production costs or not.
Just like contractors and trades set a price that covers their cost when they give a quote, I could imagine what would happen if the end client so no I am not going to pay that hourly figure I am only going to pay you half as much the job would not get done. The farming industry at present has no leg to stand on and still have no chance of meeting their expenses.
http://www.abc.net.au/btn/story/s4464750.htm (http://www.abc.net.au/btn/story/s4464750.htm)
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So much 'noise' around this issue. Would be great to see a flow chart of who get's what.
Farmer $X
Factory $x
Distributors$x
Retailers $x
Total price at the counter = $x
Then you get to see who's doing who?
Most industries have pricing norms to work on. Where is this in the dairy industry?
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Thats actually a pretty hard question to answer (based on a couple of quick google searches)but we can start to fill the gaps.
.........Will redo this tomorrow need to rethink my calculations
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There's always 3 sides to any story....
Side A
Side B
and the truth......
unfortunately, we probably never hear the truth!!!!
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Drinking more milk won't cut it. Most milk is actually turned into other products - cheese, milk powder etc.
I have friends who own one of the largest dairy herds in Southern Africa so this is my quick overview of a very complex issue based on their input (acutally its simple supply and demand)- It is not a Coles or Woolies thing. Milk prices worldwide are low (it's not just milk, but all dairy products incl. milk powders).
US farmers are selling at less than cost of production (they're getting US$18 per hundred pounds (9 gallons) - it costs them US$20 per hundred pounds to make). UK farmers were warned back in January that prices would fall, but MG and Fronterra totally failed to estimate the global markets and kept the prices they pay Aussie farmers artificially high for 6 months hoping demand would pick up again. Those farmers have been overpaid because MG and Fronterra misjudged the market. Peversley that over payment made increasing supply in Australia more attractive so production increased. Fronterra is a NZ co-op by they way. Aussie and NZ farmers have wanted access to world markets for years. Well this is the reality of competing on the world market.
This oversupply has been caused by lots of things:
- Milk quotas in Europe have been stopped, that's an extra 9.5 billion litres of milk now on the global market.
- European stocks had been depleted based on Russian and Chinese demands - so demand outpaced supply and prices went up over the last few years. Europe has since ramped up production chasing that higher price. BUT....
- Russia has stopped buying European milk in protest at sanctions for Ukraine, reducing demand. That European milk that went to Russia is now being sold in other markets driving down prices. At the same time Eastern European producers are selling at extremely low prices and increasing production as they modernise - which Russia is buying.
- Demand in China has dropped.
- Feed prices in the US have dropped making their milk cheaper (fracking has increased oil production so corn that went into biofuels is now being sold as animal feed - feed prices have dropped by about US$11 per 100kg milk or 1/3) making marginal cost of production lower. Current estimates are that 75% of every new tonne of production across the USA is expected to be sold on the global surplus market.
- Chinese investment in Australian dairies has actually increased supply making prices fall as well
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Well summed up.
Whilst the situation is not good for many producers, dairy is not the only industry affected in this way.
Meanwhile, the Facebook sheep jump on a band wagon and go off 1/2 cocked and achieve nothing, but they get to feel good about it.
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One more thing that has been discussed in the press, and may not be the best idea ever, is the introduction of a floor price. This was done for a long time with Wool, and led to a massive oversupply to the Australian market, a large increase in the size of the national herd and a big bill that the Aussie Government ended up footing... and wool priced at about 200% of the market price... Some articles on it for you:
-ABS 2003 Year Book (a long read, but detailed) (http://www.abs.gov.au/ausstats/abs@.nsf/featurearticlesbyCatalogue/1476D522EBE22464CA256CAE0015BAD4?OpenDocument)
-ABC Landline; the pitfalls of the end of a Price Support scheme from 2010 (http://www.abc.net.au/landline/content/2010/s3287468.htm)
Now the wool scheme ran from 1972 until 1991 and resulted in a massive stockpile of wool; that was all paid for above market price, and then ended up being sold at a knockdown price... at a cost to the Australian government.
An interesting read on the history of the Australian dairy industry from the ABS's 2004 Year Book (http://www.abs.gov.au/Ausstats/abs@.nsf/0/B006A83A9127B0F5CA256DEA00053965?Open)
Some more links to read:
http://www.dairyaustralia.com.au/Markets-and-statistics/Prices/Farmgate-Prices.aspx (http://www.dairyaustralia.com.au/Markets-and-statistics/Prices/Farmgate-Prices.aspx)
Another ABARES report (http://www.agriculture.gov.au/SiteCollectionDocuments/ag-food/food/national-food-plan/submissions-received/FOODmap_-_an_analysis_of_the_Australian_food_supply_chain_REVISED_30_July.doc) from http://www.agriculture.gov.au/ag-farm-food/food/publications/foodmap-a-comparative-analysis; (http://www.agriculture.gov.au/ag-farm-food/food/publications/foodmap-a-comparative-analysis;) the Dairy section is of particular interest obviously.
If people want to read more I'd recommend the following search words:
-Value chain (this tends to look more at where value is added at each stage, and what the barriers and enablers are)
-Supply chain (more basic - what goes from where to where)
I also tended to add ABARES or ABS to get decent results
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The real winners, and mainly since Internet and forums have started are popcorn supplies. Man they must be rolling in it. I do like mine buttered
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so this is my quick overview of a very complex issue
pretty well sums up what I had read and my understanding of the situation.
Meanwhile, the Facebook sheep jump on a band wagon and go off 1/2 cocked and achieve nothing, but they get to feel good about it.
As annoying as I always find this, the thing that has bewildered me the most is the media in general singing from the same songsheet on this, which lead me to post in the first place.
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Interesting that it is only MG & Fonterra that have dropped their prices- given that this is a global issue, one wonders how long before other milk processers will follow...........
And totally agree re the foreign investment issue- how shortsighted it is to be literally selling the farm- so much rural land in Aust is already in foreign hands- paying a far higher price than any local aspiring farmer could........
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Interesting that it is only MG & Fonterra that have dropped their prices- given that this is a global issue, one wonders how long before other milk processors will follow...........
I'm pretty sure this is because they are the main exporters and therefore exposed to international price fluctuations. I think (not sure) that a lot of domestic supply prices would be set in supply contracts and therefore in the short term at least not be affected.
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The real winners, and mainly since Internet and forums have started are popcorn supplies. Man they must be rolling in it. I do like mine buttered
Well, it's good to see that you're doing your bit, because, after all, butter is made from milk ...
It's all right, I'm leaving now :D >:D
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I'm pretty sure this is because they are the main exporters and therefore exposed to international price fluctuations. I think (not sure) that a lot of domestic supply prices would be set in supply contracts and therefore in the short term at least not be affected.
Agree, but I would think that once the farmers supply contracts expire with those companies (Lion & Norco are 2 that come to mind), it will be a whole different ball game....... at the moment those dairy farmers aren't affected, but methinks it won't stay that way!
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From LinkedIn
Safeway in Sunbury, Vic tonight (14days ago now)... The fridge is almost empty of branded milk, and take a look at the photo.. There is 3 pallets of Safeway brand milk in behind the shelves. They are literally drowning in their own branded cheap milk!!
(https://image-store.slidesharecdn.com/24eae7fd-07d6-4ac3-8a7e-66c8278c260d-original.jpeg)
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Safeway in Sunbury, Vic tonight (14days ago now)... The fridge is almost empty of branded milk, and take a look at the photo.. There is 3 pallets of Safeway brand milk in behind the shelves. They are literally drowning in their own branded cheap milk!!
If only the farmers were getting something more than just good sentiment it would be a lot better. I did have the thought that someone should start up a crowd funding page where people could buy the cheap milk and the donate the difference so that the farmers could actually get it.
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If only the farmers were getting something more than just good sentiment it would be a lot better. I did have the thought that someone should start up a crowd funding page where people could buy the cheap milk and the donate the difference so that the farmers could actually get it.
Not directly to he farmers short term but a good step in the direction.
https://www.gofundme.com/drp3sgkc/
We buy 4real milk or malenys dairy milk. Not that we but much of it a week
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We buy 4real milk or malenys dairy milk. Not that we but much of it a week
make milk shakes and sell them on your front lawn.
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make milk shakes and sell them on your front lawn.
You sir are a genius. Can you supply me with some good Chinese strawberry syrup?
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You sir are a genius. Can you supply me with some good Chinese strawberry syrup?
No, but I know some good music you can play to attract customers
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Why on earth would you want to pay all dairy farmers more for milk and encourage the marginal ones to keep on supplying when there's an oversupply? Much better for the most marginal farmers to decide to quit and ultimately leave higher returns for those supplying the right quantity demanded. Misplaced charity here is a lot like Gummint drought relief encouraging marginal farmers to stay on and keep producing, depressing prices and at the same time propping up agricultural land prices for all farmers.
Hands up those who think we should also prop up the likes of Compass Airlines, Dick Smith, Masters, etc?
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Why on earth would you want to pay all dairy farmers more for milk and encourage the marginal ones to keep on supplying when there's an oversupply? Much better for the most marginal farmers to decide to quit and ultimately leave higher returns for those supplying the right quantity demanded. Misplaced charity here is a lot like Gummint drought relief encouraging marginal farmers to stay on and keep producing, depressing prices and at the same time propping up agricultural land prices for all farmers.
Hands up those who think we should also prop up the likes of Compass Airlines, Dick Smith, Masters, etc?
There is a part of me that agree's with you, I think there are sometimes some extenuating circumstances though and think there are some at play here, like the really low price some farmers were going to be getting for milk was going to go back up in two months and geopolitical causes that could change in the future. Inevitably though the less efficient farms are going to have to either get a whole lot efficient to be more competitive on the global stage, find additional funding streams or bow out. Deciding to quit couldn't be an easy decision for multi-generational dairy farmers who have known nothing else and I think that's part of the reason people feel for them and want to help them out, which brings me back to my original point of buying branded milk not doing anything especially in the short term.
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All we are really doing is shifting the profit margin from company A to company B. I reckon that there is a fair chance that even though its blatantly obvious that MG and Fonterra had claw back provisions in their contracts so probably do Woolies and Coles so whilst their product is not shifting those farmers will be hurt as well, which in effect balances only a very small section of the market given the export quantities involved.
Like any business generally bigger means better efficiency and as long as the structure is correct better bottom lines. As Shitty as that is to say.
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Still hasnt answered why bottled water (which is basically free) costs more than milk which has to be "grown" and then processed.
Only can think of 2 reasons.
One is the world free market price of water is higher than milk
Or the other is people are getting screwed.
Cheers Glen
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Still hasnt answered why bottled water (which is basically free) costs more than milk which has to be "grown" and then processed.
Only can think of 2 reasons.
One is the world free market price of water is higher than milk
Or the other is people are getting screwed.
Cheers Glen
Two sides to the market coin. Supply and demand and in that sense diamonds, gold and coal are all lying around 'free' as you call it and then there's the cost of my haircuts vs the missus and they tell me that's all to do with particular consumer taste plus utility producing overall market demand. The problem is there is normal, utilitarian, rational earthling demand and then there's the other end of the spectrum with the intergalactic space traveller taste variety. The latter prefer bottled water to tap water and milk too but they do have certain redeeming features in constant demand you'll note.
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Two sides to the market coin. Supply and demand and in that sense diamonds, gold and coal are all lying around 'free' as you call it and then there's the cost of my haircuts vs the missus and they tell me that's all to do with particular consumer taste plus utility producing overall market demand. The problem is there is normal, utilitarian, rational earthling demand and then there's the other end of the spectrum with the intergalactic space traveller taste variety. The latter prefer bottled water to tap water and milk too but they do have certain redeeming features in constant demand you'll note.
Translates to " 2 sides of the coin are one is getting screwed cause they can and the other is one gouging profits cause they can."
Cheers Glen
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What is it with the space travellers and milk-
http://health.thewest.com.au/news/2907/health-alarm-as-women-avoid-dairy (http://health.thewest.com.au/news/2907/health-alarm-as-women-avoid-dairy)
Reminds them of sore tits with the nippers perhaps? If that's the case can we earthlings just have good old fashioned M for milk back so we don't get completely bewildered standing in front of the super fridge?
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interesting reading for anyone who still cares as social media faux outrage has died down: (and no its not $1milk)
http://www.smh.com.au/business/the-economy/dairy-crisis-explained-its-more-to-do-with-vladimir-putin-than-1-milk-20160630-gpvegb.html (http://www.smh.com.au/business/the-economy/dairy-crisis-explained-its-more-to-do-with-vladimir-putin-than-1-milk-20160630-gpvegb.html)
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interesting reading for anyone who still cares as social media faux outrage has died down: (and no its not $1milk)
Yep it's always supply and demand in world markets for farmers, but then the pollies have to kneejerk with sanctions or live cattle bans and then they have the nerve to rollout relief loans and subsidies and pretend they care with our taxes. Propping up those in trouble never helps the most productive farms and their farmer livelihoods, but simply prolongs the agony of low prices for them too. Economic sanctions and bans are just as useless but you can't reason with the overemotional tosspots.
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Seriously, have any of you real knowledge of the margins that farmers have to operate on?? ???
Go and work back, how much a dairy farmer is working for, on an hourly basis. Be forked if I would be busting my arse for that wage. I dealt with them for many years and it's not all strawberries and cream and if you think the cheap chit milk is a tasty as real milk, then you really don't have any bloody idea. ::) Do you honestly think that the likes of Coles and Woolworths give a ratsarse about the real cost of production? No, they would sooner bring milk from overseas at a much cheaper cost, from countries that require people to work for two bags of rice a week. >:(
Same as small crops farmers, they get the hell screwed out of them. >:(
Foo
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Dozens of Gippsland dairy workers have been locked out indefinitely by milk producer Parmalat, in the latest aggressive pay dispute to hit Victoria.
At 6am on Tuesday, workers who arrived at the gates of the Parmalat-owned Longwarry Food Park, east of Melbourne, were met with news of the indefinite lockout and closure of the site.
The National Union of Workers said the Longwarry workforce was among the lowest-paid in the dairy industry, and staff had been calling for improved conditions in their pay deal to bring them in line with other Parmalat sites statewide.
Read more: http://www.theage.com.au/business/workplace-relations/parmalat-locks-out-dairy-workers-over-pay-dispute-20160705-gpyrcp.html (http://www.theage.com.au/business/workplace-relations/parmalat-locks-out-dairy-workers-over-pay-dispute-20160705-gpyrcp.html)
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Very refreshing to read such a mostly levelheaded discussion on this topic.
I read a lot of Coles and Woolies, but not one mention of Aldi.
Can any of the 'in the know' people out there shed some light on their suppliers (local or not) and what part they play in this evolving predicament?
I've tried my best Google-foo, but so far real answers on the Aldi milk suppliers are hard to find.
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Aldi dairy products are supplied mostly by Fonterra
Sent from my GT-I9505 using Tapatalk
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If you want more info:
https://www.choice.com.au/food-and-drink/dairy/milk/buying-guides/milk (https://www.choice.com.au/food-and-drink/dairy/milk/buying-guides/milk)
Goes some way to explaining.
Also says that the small amount of milk we purchase at the Supermarket, in the overall scheme of things, won't make much difference.
It might make the purchaser feel a bit better, but won't change the result much.
I'm just the messenger ok.
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And whenever you try and prop up markets it's the usual bunfight between winners and losers-
http://www.weeklytimesnow.com.au/news/opinion/victorian-dairy-industry-leaders-shunning-the-vff-farmers-fund-brand/news-story/4d7a27dec3a258686b5a9e763f15a8f5 (http://www.weeklytimesnow.com.au/news/opinion/victorian-dairy-industry-leaders-shunning-the-vff-farmers-fund-brand/news-story/4d7a27dec3a258686b5a9e763f15a8f5)
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And whenever you try and prop up markets it's the usual bunfight between winners and losers-
http://www.weeklytimesnow.com.au/news/opinion/victorian-dairy-industry-leaders-shunning-the-vff-farmers-fund-brand/news-story/4d7a27dec3a258686b5a9e763f15a8f5 (http://www.weeklytimesnow.com.au/news/opinion/victorian-dairy-industry-leaders-shunning-the-vff-farmers-fund-brand/news-story/4d7a27dec3a258686b5a9e763f15a8f5)
This is the bit that everyone misses.
Quote from the article.
4 per cent of what is in their vats goes into the fresh white milk that sits on supermarket shelves,
The whole debate is just bull.
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Yep a lot of our commodities are dependent on international demand-
http://www.msn.com/en-au/money/company-news/bellamys-faces-class-action-lawsuit-after-dollar500-million-share-plunge/ar-AAlxz1U? (http://www.msn.com/en-au/money/company-news/bellamys-faces-class-action-lawsuit-after-dollar500-million-share-plunge/ar-AAlxz1U?)
No shareholder was complaining when their shares in Bellamys were going up rather spectacularly while those wicked Asian mums were taking the bottles out of our babies mouths >:D
Methinks the dairy farmers supplying Bellamys might like a few of those wicked Asian mums back now :-*