The Guardian July 5, 2000


Consumers, farmers milked

The price of milk has gone up, and dairy farmers face extinction after 
the deregulation of the NSW Dairy Industry last Friday.

The legislation had twice been blocked in the Upper House as opponents of 
the bill aimed to secure additional financial assistance to the farmers. 
However, the collapse of National Party support meant the deregulation went 
through without amendments.

Instead of compensation, the parties agreed to the establishment of a 
committee to review the impact of deregulation on dairy farmers  a 
traditional parliamentary way of burying an issue.

Under the previous system, dairy farmers received a guaranteed price of 
over 50 cents per litre of fresh milk sold. The power now rests with the 
large milk processing corporations and supermarket chains, who immediately 
dropped the price paid to farmers to below 30 cents.

The Federal Government has promised $337 million to NSW as a sweetener to 
facilitate the restructuring of the industry, an incentive for small 
farmers to quit. This will be paid for by an 11 cents per litre rise in the 
price of milk from July 1. 

Final score from deregulation:  Farmers will receive 20c less, consumers 
will pay 11 cents more, the take by milk processors and big stores, up by 
20 cents.

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