Milk money on way

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Milk money on way

Bad season: Buffalo dairy farmer Peter Young would benefit from milk price step-ups.

By Chris Brown
SOUTH Gippsland dairy farmers are likely to receive more desperately needed money for their milk.
Murray Goulburn has flagged further step ups before the end of the season.
The co-operative’s chairman Grant Davies said the world market is returning.
“Export prices have improved in the last four months and we anticipate the better prices we have received for our products will allow us to pay better returns to our farmers,” he said.
“There’s starting to be a drop in production around the world, so there’s starting to become a small shortage.
“It’s the recovery of the world markets from the financial crisis. People have got the ability to buy dairy products.”
Mr Davies said the Australian dollar was a wildcard.
“The dollar is certainly having an effect, but we still anticipate even with the dollar in the range that it is we will still be able to pay a fairly reasonable price by the end of the season,” he said.
“We’re very mindful the prices paid in the first six months of the year were below the cost of production and this is not sustainable.” 
One dairy farmer looking forward to any step-ups is Buffalo’s Peter Young.
“I’m probably $100,000 down on last year,” he said.
“You can tighten your belt so far, but you can’t really recover that back, so any step ups we receive this year will go into just getting into next year a lot easier.
“We still have expenses that haven’t changed a great deal. You’re still not getting enough back for what you’re putting in.”
Mr Young said he was getting about 30 cents per litre of milk, but needed 32 cents to be okay for next year.
“I didn’t have a great season, which would be different to other farmers. I had a very wet winter and the grass went straight to head once it did come in hot so I didn’t get a spring,” he said.
Mr Young leases the farm off his father and mother, but owns the cows and machinery.
He is milking about 220 cows.
“The established farmers will cut through these situations a lot better than ones like me who are coming into the industry We haven’t the back-up capital to cover a downturn as well as they have,” he said.
“I know a lot of sharefarmers are pulling out because of that, it’s just made it too hard to cope with.
“Next year’s looking quite good so hopefully we get a strong price next year and we’ll go on again.”
Mr Young said with the way international prices are he couldn’t see how Murray Goulburn could have handled the situation better.
“At least with Murray Goulburn, unlike some of the other companies, the directors are dairy farmers themselves so they know what we’re going through and they’re still aiming at getting the money to the farmers,” he said.

Short URL: http://www.thestar.com.au/?p=315

Posted by SiteAdmin on Jan 28 2010. Filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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