THE Legendairy television advertising campaign could be the next victim of low milk farm gate prices, while job losses have not been ruled out as Dairy Australia looks to reduce spending.
With an expected decline in income levels, DA has produced a tighter budget for 2016/17.
DA managing director Ian Halliday said the dairy industry is facing one of the most challenging years it has experienced for some time.
“This is having an impact on everyone in the industry and DA is no exception,” he said.
Overall the industry research, development and extension organisation has budgeted for a 14 per cent decrease in income during the next three years.
DA originally anticipated an annual income of $61-63 million, but with lower milk prices and expected lower milk volumes it is now budgeting on $52-53m a year.
The reductions in DA expenditure will primarily come from significantly reduced expenditure in consumer marketing, where TV advertising linked to the Legendairy campaign will stop.
Mr Halliday also said he had told staff that he could not guarantee there would not be job losses.
He has committed to staff that announcements on any job losses will be finalised by the end of July.
In revised plans developed throughout the past two months, DA management and the board have adapted current programs to focus even more strongly on farm profitability, farmer capability and the core issues facing the industry around its license to operate.
“We talk with farmers from all regions every day and we have a fairly good idea what they are going through,” Mr Halliday said.
“Supporting dairy farmers is the key focus of our immediate programs.
“Our investment in services and resources to guide and assist dairy farmers in the immediate term has been ramped up.”
DA has reallocated existing funds, which have been combined with extra input from government and processors.
Together they have created a total support package of $11.4m.
Of that, $2.8m from existing funds has been committed to work with dairy farmers through the umbrella ‘Tactics for Tight Times’ program.
One of the key elements of this program is Taking Stock, which provides free, confidential, one-on-one support with an experienced dairy advisor.
Taking Stock assists dairy farm businesses in identifying their current business and operational challenges and guides them towards improving their profitability.
The industry’s Regional Development Programs are assisting farmers to access the services they need.
“While the budget for the next 12 months includes spending on a range of immediate issues facing the industry, DA will continue its investment into long term research, development and extension programs,” Mr Halliday said.
“Initiatives like our leading scientific research through DairyBio and DataGene, which will consolidate the activities related to genetic improvement of dairy cattle, will continue to provide long term benefits to the dairy industry.”
