The United Dairyfarmers of Victoria is calling for input on changes to the Federal Government’s Milk Price Index.
Federal Agriculture Minister David Littleproud said last week the index would face a thorough examination, under a review into how well it was meeting the needs of farmers and processors.
“I’m not convinced the index is working as well as it can for farmers so I want to know if that’s the case and what can be done to make it better,” Minister Littleproud said.
The index was designed to help farmers easily access information, which can help them make decisions on their businesses.
Mr Littleproud said the index needed farmers to enter their data into the index, to ensure it worked well.
UDV president Paul Mumford said he believed that was one of the reasons the index appeared to be failing.
“It does seem to be a product that's broken, and it won’t be successful, without farmer input,” Mr Mumford said.
“I think one of the reasons farmers haven’t taken up the offer is because they are just far too busy – they have better things to do than giving free data to the government.”
Mr Mumford said the UDV had contacted the Federal Department of Agriculture to feed in issues on how it could be improved.
“What I would like from our members is to hear their thoughts and solutions around the index and how it can be enhanced, to reflect a fit-for-purpose product.
“If farmers have got some input we would love to hear about it.”
David Kerr, Kyabram, said processors generally followed each other, in setting prices.
“Working on such a low base, they pay what they can afford, not what they have to pay,” he said.
“It’s not the real price of milk anyhow, they add on a drought subsidy, so it doesn’t give a true indication of the milk price.
“If it rains, they remove the incentive.”
He said it wasn’t surprising some processors were announcing milk prices, well ahead of the season opening, as they were short of milk.
“There is no clarity; I think that’s what people are getting sick of.”
Anthony Hill, Middle Tarwin, said the index was a waste of time and money.
“I don’t know why they worried about it, it was just a waste of money, from the start,” Mr Hill said.
“I just look at the world markets and the dollar – that’s where I get my trends from.”
He described the index as “an easy out” for the processors.
“This is what its showing and this is what we should be paying.”
He agreed there would be farmers who would not have time to put data into the index.
Lachie Sutherland, Larpent, said he didn’t believe the index was updated frequently enough.
“The Global Dairy Trade is fortnightly and covers global supply and demand,” Mr Sutherland said.
“I think the feeling we are getting is that prices are on the rise, but we are not seeing it, on the index.”
He said he had put his prices into the index, to try and help, but it gave too broad a picture.
“I thought it would be a lot more rigorous and specific than it is.”