Dairy Australia publishes guide to new milk supply agreements

Dairy Australia has published a guide to assist dairy farmers with the introduction of new industry wide milk supply agreements with processing companies, which come into effect today.

A Farmer’s Guide to Milk Supply Agreements and the Dairy Industry Code of Conduct has been designed to make milk supply contract negotiations easier and more transparent. It is available on our Milk Supply Agreements page.

Dairy Australia’s Group Manager of Trade and Industry Strategy, Charles McElhone, said rules around standard form milk supply agreements are part of the Dairy Industry Code of Conduct launched on 1 January 2020.

“As farmers gear up for their new season contract negotiations, for the first time they will be looking at milk supply agreements that come under the Dairy Industry Code of Conduct. Contracts might look different, some of the terminology will be different, there are new terms that have to be incorporated into agreements.

“It’s a priority for us that farmers have access to information that makes it easier to get their head around some of these changes. We’ve developed these resources as a practical guide for farmers to consider how a milk supply agreement aligns with their business.

“All milk supply agreements created, varied or renewed this year are subject to the Code and, by January 2021, all milk supply agreements no matter when they were entered into, must be Code-compliant,” Mr McElhone said.

Australian Dairy Farmers and Australian Dairy Products Federation contributed to the guide, which can be used in conjunction with contract templates developed by these organisations. The Federal Government provided funding as part of an election commitment to support farmers with the introduction of the Dairy Industry Code of Conduct.