Coles is making my blood boil

What a month it has been. On the home front Michael took the plunge and attempted the double knee replacement . The less said about the outcome of that at this point in time the better .

Out in the wider dairy community suppliers to Lion via the Dairy Farmers Milk Supply Coop (DFMC) got the devastating news (and there is more to come) of what their “quotas” were likely to be and the atrocious price on offer for Tier 2 milk (milk in excess of quota). What was this bad news?  I am finding it difficult to even put the figures on paper. Farmers supplying Tier 2 milk are receiving a max of 14c/litre and some even as low as 11c/litre

I can categorically say the NSW dairy industry is facing decimation and in the short term its the emotional trauma that is hitting first for those farmers finding themselves affected by this double whammy.

As in any situation like this, various factors have bought on the conditions DFMC suppliers find themselves in. The one underlying factor that is preventing any hope of a revival is the Milk Price Wars started by the Coles Prices are Down Campaign  that comes surrounded with spin like this COLES CUTS PRICES AGAIN TO HELP AUSTRALIAN FAMILIES.

Well I can tell you Coles there are a lot of wonderful, caring dairy farming families hurting very badly at the moment and I am finding it hard to believe you are that naive that you think Australian families want you to destroy other families to deliver an extra $450 savings in their pockets by shopping at Coles

Then this came along and it made me even more furious. In another blatant marketing gimmick Coles has announced it wants to put video cameras on Aussie Farms. This stunt has been covered superbly by Milk Maid Marian in these two blog posts

http://milkmaidmarian.com/2012/08/10/coles-wants-video-cameras-on-aussie-farms/

http://milkmaidmarian.com/2012/08/10/coles-wont-rule-out-cctv-on-australian-farms/

As soon as I have a window I will be officially inviting Coles leadership team to our farm. I can offer them 6 star Eco accommodation, hands on milking experiences as well as a guided tour of our dairy facilities, pasture research trials and natural resource management activities but that will have to wait a few weeks.

Today I am off to Canberra with my farm consultant Dr Neil Moss. Neil and I both care very much about our fellow dairy farmers and we are doing everything in our control to make the future a better world for them to farm in

Today we have a wonderful opportunity to talk to some very bright minds in Australian Government Lands and Coast and we will be listening and having highly productive two way conversations and we will come up with a plan I am confident of that.

And we need to, because, Australia we have a big problem, the supply value chain model isn’t working and we have to get it remodelled fast.

Sustainability must be embedded in the supply chain system. It is imperative we have partnerships between community, government and the private sector to enable our farmers to continue to supply the best quality products for people, animals and the planet.

This will only happy when our supply chain partners become advocates for our farmers and sadly Coles you just don’t get it  YET but you will and I look forward to helping you see the light.

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Coles their future is in your hands – lets make it happen together  

13 thoughts on “Coles is making my blood boil

  1. Congratulations on a wonderful moving post. It sometimes feels like farmers are the forgotten people of Australia. I hope all the dairy farmers can hang in there and fight back. Other farmers are right there beside you as you take up the fight.
    I do hope the knee reconstruction situation improves also.

  2. Thanks for the link, Lynne, and for keeping this issue in the spotlight. If we were the slightest bit uncertain before now, this predatory move by Coles signals that we as farmers need to do a better job of communicating with everyday Australians.

  3. It’s a conversation I had with my husband just recently.
    What’s the difference between the cheap milk and the expensive milk? It’s all made of milk.
    The difference is obvious to me now. Shame on the big chain supermarkets.
    I can see it would be a tough decision at the register for many families though.

  4. Thanks Lynne , & thanks to all those in the community that are willing to help .The whole Coles pricing situation affects not only milk but every other independent business in Australia and also service providers to the various industries ,If people want to know how to help please BUY BRANDED MILK ( it dosent even matter what brand ) we as farmers are all in this together .The two big supermarkets may think they can split the farming communities by having different supply chains but we should ALL stand together against them.
    Preferably buy it from the local bakery or the independent service station anywhere but the big TWO. They use milk to draw you in as a staple food product and before you walk out the door after the long walk from the front door to the back of the shop where the milk conveniently situated you’ve spent the money you’ve saved on your $1.00 a litre milk on the impulse items you would not have purchased elsewhere
    Remember it would suit the supermarkets if all that eventually is available is UHT long life milk
    NO REFRIGERATION ,or powered milk reconstituted ! , if Farmers are forced to sell all our heifers to Export Markets in the short term to keep the farms here going , we may even be able to buy that powdered milk from CHINA !!!

  5. I couldn’t agree with you more, this makes my blood boil too! That’s why I have not set foot inside a Coles or Woolworths supermarket for several months now, and why I like to buy the locally produced Jonsey’s milk from the local store. As consumers we have a choice, and I just wonder whether the duopoly will have to listen if we stood up en masse and gave a clear and resounding message that we are not happy by refusing to buy their product!

  6. Lets not forget Woolies – they are both driven by greed which sadly does not consider the future of the farmer. Excellent blog! I never buy Coles milk and never will until they show more support for the farmer and THEIR families.

  7. Who’s to say that if Coles or any other shop decide to raise the prices they charge customers for their milk that that will flow on to the producer? Surely Lion et al would be more likely to just pocket the extra money?

    • Thank you for you question Kevin. The situation as you would expect is complicated. The two issues putting downward pressure on prices at present are – milk oversupply in Eastern states and the supermarket discounting of milk (whole and modified). The oversupply issue could be corrected by a processor (Australian or foreign) investing in a dryer to take up the export milk for export purposes

      Unless consumers decide otherwise the supermarket discounting will end when they have achieved their objective of growing home brand share of the milk market to their targets Supermarket’s share of Australian drinking milk sales is now around 53% and growing. Private label brands now account for around 51% of total supermarket milk volumes, up from around 25% in 1999/2000. This result has been greatly assisted by the current discounting regime. When their targets have been reached – rest assured prices will increase.
      In the meantime…
      To assist farmers Australians can choose to purchase branded products and not the generic equivalents. This would support the margins of the processors and therefore hopefully farmer margins. Its very important to note everyone in the supply chain needs to be able to put food on their family’s table and processors can only pay farmers what they can get out of the marketplace and at the moment that is less than nothing
      As for the supermarkets, it would help if they increased the price of all generic milk ie stop using milk as a loss leader – the chances of this happening in the next couple of years are very remote given their aggressive generic brand growth strategy and the billion dollars profits these current campaigns are driving for them.
      So it is clear the only way forward is for Australian consumers to vote with their wallets and feet, buy brands or shop elsewhere.

  8. Great post. I’m saddened by what is happening in the supermarkets and find it frustrating how many people cannot see past the short term saving made by purchasing coles/woolworths branded products. I shopped yesterday and it’s amazing how quickly the shelf space for coles products has grown. A year ago there were 2 full bays for Dairy Farmers milk, now it’s a tiny section 2 bottles wide.

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  10. I am part of a family owned SUPA IGA in Victoria. Of course this price cutting is effecting us, there is no doubt about it, however, now 99% of our Milk that we stick is Sungold from Warrnambool Cheese & Dairy. We are slowly increasing our range of Australian Owned & Made, products and slowly eliminatingsnot so well known international made items!! And guess what… OUR CUSTOMERS LOVE IT!!!!! You don’t need to cut prices to get customers… you just need to show them you care, show them you support the Country, Aussie jobs and Good Quality Products and they’ll be appreciative.

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