Murray Goulburn’s woes have increased with a former director saying the cooperative’s milk payment structure was not in accordance with the interests of all shareholders.
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Duncan Morris, an accountant and farmer at Cobden, said he was concerned there was a difference of $1.20 a kilogram milk solids between the price paid to “average mum and dad suppliers” and large corporate suppliers.
He said MG’s milk payment structure was “not in accordance with cooperative principles”.
“It is not in the best interests of the cooperative’s shareholders,” Mr Morris said.
He made the comments to The Standard after the Australian Competition and Consumer Commission dairy forum in Warrnambool on Monday.
Mr Morris resigned as an MG director last May after the cooperative imposed retrospective milk payment cuts on its suppliers.
However he declined to say on Monday whether the disparity between the milk prices paid to “average mum and dad suppliers” and corporate suppliers was the reason behind his resignation.
Numerous other dairy farmers expressed concerns at the ACCC forum about their milk payment systems.
Many farmers said the systems were too complex to allow them to accurately compare the milk prices offered by one dairy processor compared to another.
ACCC chairman Rod Sims said the ability of some payment systems to impose retrospective payment cuts on farmers meant farmers bore “all the risks” and were not “even” systems.
Murray Goulburn denied the difference in its payments to “mum and dad” suppliers and large corporate suppliers was as high as Mr Duncan said.
But it said various incentives, different contractual arrangements and volume and collection charges meant each of its suppliers was paid a different milk price to MG’s average farm gate milk price.
“In line with our co-operative principles, MG regularly reviews its milk payment structure,” an MG spokesman said.
“The last occasion was in 2013 and as outlined by the chairman at the AGM, we are undertaking another review this year.”
Murray Goulburn last week announced a $31.9 million loss, and 21 per cent drop in milk supply, for the six months to December.