Milk sales illustrate consumer support

The latest Dairy Australia outlook report showed branded sales volumes increased by 7 per cent, while the supermarket branded labels fell by nearly 2pc.

DA senior analyst John Droppert said this was a result of consumers looking to support dairyfarmers amid the climate of low prices.

“It has been a very dramatic response to the media out there following the (farmgate price) step down,” he said. 

“We saw a pretty quick shift to the balance between private label and branded milk and so far, it has been sustained.”

It marks a reversal of a long-term trend on increased private label share.

Mr Droppert said the market was split with 54pc of sales to supermarket private labels and 46pc to branded milk. He said consumers were continuing to choose branded milk, with consumer research indicating the purchase decision was in support of dairyfarmers. 

Mr Droppert said this would not have an immediate flow-on effect to the farmgate price, but did mean more money in the supply chain.

“This ultimately means there is more money going to farmers,” he said.

The report also showed a shift to fresh full cream milk, in preference to reduced fat varieties, with it accounting for 61pc of the fresh white milk category – up from 54pc three years ago.