Woolsthorpe dairy farmer and Murray Goulburn (MG) supplier Brian McLaren says he’s “mentally, financially and physically” exhausted from the impact of the firm’s farmgate milk price cuts last year.
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He’s pleased the Australian Competition and Consumer Commission (ACCC) is taking legal action against MG for misleading conduct over its milk price forecasts during the 2015-2016 milk season but said the impact of the price cuts had “ruined people”.
Mr McLaren said he was particularly pleased the ACCC was seeking a financial penalty from MG former managing director Gary Helou and former chief financial officer Bradley Hingle rather than the MG Cooperative.
If it was seeking a financial penalty from the MG Cooperative, it would have meant the cooperative members, the dairy farmers, who were already suffering because of the price cuts, would suffer further, he said.
Mr McLaren is out of pocket hundreds of thousands of dollars following last year’s price cuts, which left him losing about 10 cents a litre for every litre of milk he produced during a three month period.
He said if MG reinstated the claw back of milk payments under the retrospective price cuts, he would have to assess whether he continued in the dairy industry.
Mr McLaren said he had remained a MG supplier, despite his anger over the price cuts, because he believed that without milk supply, MG might fold and the south-west dairy industry would suffer from less competition for milk.
ACCC chairman Rod Sims told The Standard the claw-back would be part of the ACCC’s legal case against MG.
However Mr Sims said while the ACCC might try and stop MG from undertaking similar retrospective price cuts in future, he believed it would be “hard to reverse what has been done”.
Mr Sims also said the ACCC, in an inquiry separate to the court case, was investigating the ability of dairy farmers to switch between dairy processors to provide other options to farmers who were members of dairy cooperatives and had to bear all the risks of the cooperatives’ management decisions.
United Dairyfarmers of Victoria president Adam Jenkins said the ACCC’s legal action was making MG more accountable for its decisions.