The Victorian dairy Industry is facing major cost blow outs over the next 12 months due to increasing energy prices, Member for South West Coast Roma Britnell says.
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Mrs Britnell said new analysis from dairy research and development corporation Dairy Australia showed that dairy processors were facing increasing power costs of between 50 and 70 per cent in 2018, presenting a real threat to the industry.
She said the analysis showed electricity and gas price rises will add $100 million to the industry’s costs – making Australia’s milk less internationally competitive
“The analysis also shows that on farm, producers are facing an average energy bill increase of $3760 over the next 12 months,” Mrs Britnell said.
Dairy processors would pay an average $14,000 per farm increase in costs that would also be passed on to farmers, she said.
“The looming energy crisis needs urgent attention.
Dairy products are in demand all over the world and it is foolish to have our own domestic policies crippling us.
“This is a problem right now – industry cannot wait until 2035 when the Minster for Energy suggested renewable energy projects would start putting downward pressure on prices,”s Mrs Britnell said.
She said the dairy industry employs about 6000 people directly on farms and in processing and the increase in energy costs directly threatened those jobs.
“Driving up the cost of doing business will mean investors will start looking overseas instead of Australia, which Dairy Australia predicts in its analysis,” Mrs Britnell said.