The Guardian February 7, 2001

Farmers milked by deregulation

by Andrew Jackson

Over three hundred dairy farmers in New South Wales and Queensland have 
been forced off the land in just six months under the new deregulated 
market system forced on them by the Federal Government. Another 30 percent 
of farms remaining expected to quit the industry within the next five 

Dairy farmers in NSW who were receiving up to 54 cents per litre of fresh 
milk under the regulated system have watched helplessly as the large milk 
processing corporations have slashed the farm-gate price to just 25 cents, 
leaving the average farm with a loss of $9,500 in the current financial 

The figures, contained in a report by the Australian Bureau of Agriculture 
and Resource Economics, confirmed many of the worst-case predictions that 
were being offered prior to deregulation last year.

The Federal Government told the States they had to deregulate by June 30 
last year if they wanted to take advantage of a $337 million dollar 
"restructuring" package on offer.

The package was not aimed at keeping small dairy farmers in business, but 
was being offered as an incentive to quit the industry.

While the Federal Government has big-noted itself on the generosity of the 
package, it is in actually being funded by a new 11 cent tax on consumers.

The NSW Agriculture Minister Richard Amery claimed last week that "the NSW 
dairy farmers specifically ruled out asking for additional compensation" 
when deregulation was passed by State Parliament.

In fact, the legislation to deregulate was blocked twice in the NSW Upper 
House by the Nationals, Greens and Democrats, who were seeking greater 
financial support for farmers from the State Government.

However due to Federal Government pressure the Nationals caved in at the 
last minute and the Bill went through without a cent of extra assistance.

The outcome of deregulation has been handing over small farm production to 
the agri-business corporations, and increased profits for the multi-
national milk processors, at the expense of an estimated 15,000 jobs in 
rural Australia.

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