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Milk Supply Agreements



Farmer’s guide to Milk Supply Agreements and the Dairy Industry Code of Conduct

Developed by Dairy Australia, the following resources help farmers interpret the Dairy Industry Code of Conduct and can be used with templates developed by the ADF and ADPF.

The resources help farmers work through important legal and operational considerations for their farm business when negotiating contracts, and outline the terms that needed in a compliant milk supply agreement.

We also included talking points for contract discussions that farmers can use when negotiating contracts with processors.

These guides will help farmers improve profit margins in their dairy businesses.

Related Resources

  • Milk Supply Agreement checklist 1

    PDF123.97 KB
  • Milk Supply Agreement checklist 2

    PDF353.06 KB
  • Talking points for contract discussions

    PDF1.38 MB
Podcast

Podcast 48: What to consider before signing a milk contract

Finding the right milk company to supply to can be a complicated decision for dairy farmers. In the latest episode, Murray Dairy’s Lisa Birrell spoke to Strathmerton farmer Andrew Wilson about how he compares different companies and chooses the right one for his circumstances.
Published:
Business Management

The Milk Value Portal and the Farmgate Milk Value Tool

The Milk Value Portal (MVP), developed by the Australian Dairy Products Federation, was created to provide farmers with a deeper understanding and transparency of farmgate milk prices.

The MVP is your gateway to understanding the many factors that shape your milk price and how they might influence decision-making next time you sign a milk supply agreement.

The Farmgate Milk Price Tool in this portal enables dairy farmers to assess the current value of their milk based on location, farm size, calving pattern, milk quality and components.

In combination with details from your processor, the Farmgate Milk Price Tool creates a weighted average milk value for a farm like yours and shows you all the milk prices available from different milk processors in your region. However, it won’t give you a specific milk price offer.

This tool also allows you to see how changes of seasonality supply could affect your milk price.

The Dairy Industry Code of Conduct

The Dairy Industry Code of Conduct (also known as the Mandatory Code, or the Code) aims to improve the clarity and transparency of trading arrangements between dairy farmers and processors.

Under the Code, which came into effect on 1 January 2020, dairy farmers and processors are given specific protections and obligations.

All Milk Supply Agreements (MSAs) between suppliers and processors that are created, varied or renewed this year are subject to the Code. All MSAs, no matter when they were entered into, must be compliant with the Code from 1 January 2021.

The Australian Competition and Consumer Commission (ACCC) is responsible for enforcement of the Code and investigates alleged breaches.

The ACCC has developed a fact sheet intended to help dairy farmers understand their rights and obligations under the Code.

Click here to find the ACCC factsheet: ‘What the dairy code means for farmers’.

Australian Government logo

This project is supported by the Department of Agriculture, through funding from the Australian Government.


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