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A former dairy farmer, now supermarket executive, has called on Coles and Woolworths to raise the price of milk.
Champions IGA Group executive chairman Brendon Goddard said he could not understand why the major supermarkets wanted to keep the price of milk at $2 for two litres when dairy farmers were struggling.
“It’s been at $2 for too long – farmer’s costs have gone up,” he said.
“Long-term we are crucifying our farmers.”
A two litre carton of milk sells for $2.05 in his stores, and has done so since 2011.
Mr Goddard wants to increase the price to support the dairy industry, but said he had to compete with the major supermarkets.
“Any staple line you have to be competitive on,” he said.
He said any move to increase the price of milk would have to come from Coles and Woolworths, as they have the majority of the market share.
Coles recently announced a $1 million dairy industry fund, but Mr Goddard said it did not go far enough.
Instead of donating 20-cents-per-litre from sales of a new brand of milk, to be launched in three months, Mr Goddard called on the supermarket to raise the price of milk by 20 cents.
“That would help every dairy farmer,” he said.
He was suspicious of claims by Coles and Woolworths that dairy fridges were running dry on branded milk, leaving buyers little option other than the supermarkets’ own products, because of increased consumer demand.
“I have had no issue with the supply of branded milk,” he said.
“We buy off Parmalat, the old Sandhurst dairy in Bendigo, and we have done so for 30 years.
“If you look after your suppliers long-term, they look after you.”
His central Victorian stores have seen a recent increase in milk sales, as concerned consumers search for ways to support the dairy industry.
Bendigo Family and Financial Services general manger Jenny Elvey said there was guilt associated with buying cheaper milk, but some families might not have much choice.
“Every cent makes a difference to them and for them to try to do the right thing by the dairy farmers, even though they want to, it would put an extra burden on them they probably couldn’t deal with at this stage,” she said.
She said some families might be able to absorb a small increase in the price of milk, “but on what they are getting now they could not afford not to buy the cheaper brands.”
“Sometimes they do feel guilty and it’s not really fair on society to put that guilt on them,” Mrs Elvey said.
“A lot of our clients are very aware of how tough our farming communities are doing it because our clients are doing it tough as well – they can relate.”
She was unsure what the best solution for milk pricing at supermarkets would be, but said there was a need to support the dairy industry.
There are four Champions IGA stores in central Victoria – Long Gully, Kangaroo Flat, Heathcote and Inglewood.
The group is based in Bendigo. Mr Goddard is on the board of the Bendigo Business Council and has worked in the supermarket industry for about 30 years.
The Coles dairy industry fund has been welcomed by the National Farmers Federation, Victorian Farmers Federation and Agriculture Minister Barnaby Joyce.
Mrs Elvey said people could call Bendigo Family and Financial Services on (03) 5441 5277 for help with financial difficulties.