NSW Nationals Member for Myall Lakes Stephen Bromhead has welcomed his Federal colleagues’ Mandatory Code Of Conduct into the Dairy Industry, which will help struggling farmers in their fight with the big supermarkets and multinational processors.

“This is an important step and one in the right direction to help balance the scales against companies that wish to sell dairy products at a loss,” Mr Bromhead said.

“Our dairy farmers work themselves to the bone and give so much to produce, just to be a loss leader in a race to the bottom of prices that ultimately end up with one loser: Themselves.”

The Key aspects of the Code of Conduct take are:

  • All parties must deal with each other fairly and in good faith;
  • Bans retrospective step-downs;
  • A cooling off period is 14 days;
  • Stop processors from making unilateral changes to agreements, except when required to comply with legislative changes which cannot reduce the minimum milk price, or in certain exceptional circumstances that reduces the minimum price, with the processor required to notify the competition watchdog and farmer, who must be allowed to terminate the agreement if they wish;
  • Processors must publicly release a Standard Form Agreement on June 1 each year, covering the terms of milk supply and a price (or prices) that cover the terms of the agreement;
  • Bans exclusive supply arrangements between processors and farmers in combination with either two-tier pricing (where the second tier is less) or volumetric limits by processors;
  • Bans processors from withholding loyalty payments to farmers if a farmer switches processors;
  • Introduces a dispute resolution process for matters arising under or in connection with agreements; and
  • Make civil penalties available for certain provisions imposing obligations on parties to an agreement to allow the competition watchdog to issue infringement notices, recognising in penalty regimes the respective size of processors and farmers.

With 30 per cent of the state’s fresh milk coming from the Manning Region, Mr Bromhead said he was pleased to continue to stand behind farmers who were doing it so tough – not only fighting a crippling drought, but also the recent bushfires.