Dairy farmers soon forced to sell most of their milk cheese CHINA Coles and Woolworths too cheap

Australian dairy farmers could soon be forced to sell most of their milk, cheese and butter in China because they claim supermarkets are not paying them enough here. 

Australia’s largest dairy operation, Van Diemen’s Land Co., has begun transporting two full plane loads of fresh milk to China every week, selling it an exponentially higher price than the local market is paying.

And it appears they may not be the only ones, with rural New South Wales south coast dairy farmer Robert Miller predicting this may be the way of the future for more dairy farmers.

‘This is what is going to happen with the dairy industry; supermarkets in Australia aren’t paying a sustainable price,’ Mr Miller told Daily Mail Australia.

Australia’s largest dairy operation, Van Diemen’s Land Co., has been transporting two full plane loads of fresh milk to China every week

Rural New South Wales south coast dairy farmer Robert Miller (pictured) predicts exporting may be the way of the future for farmers

‘They’re paying a dollar a litre sometimes, if you’ve got Chinese paying $10 a litre it is a great thing, it’s showing everybody how great quality our product is.’

Van Diemen’s Land Co, a 191-year-old company who was purchased by Chinese businessman Lu Xianfeng in April 2016 for $280million, owns 25 dairy farms across Tasmania, and has enough milk to fill an Olympic sized swimming pool every nine days, according to Bzmark Consulting.

While Mr Xianfeng’s company, Moon Lake Investments, announced their planned cooperation with Qantas in late 2016, it wasn’t until 2018 that the regulatory procedures were finished and an open trade begun.  

Dairy farmer Rob Miller hopes the new Chinese buyers will force Australian retailers like Woolworths and Coles to up their prices to reflect a more sustainable way of living for local farmers

Woolworths and Coles have both recently introduced a 10 cent levy on the cost of milk, effective immediately and through to the end of the year, with all proceeds going directly to struggling farmers

Mr Xianfeng’s intention was to export 10 million litres of milk a year to his home town of Ningbo, in eastern China, where the product sells for A$10 – $15 per litre.

Before the first shipment had touched down in China, the company had already pre-sold A$2.2 million worth of fresh milk, equating to 15 million yuan. 

Mr Miller thinks the open trade ‘is great news for farmers.’

He hopes the new Chinese buyers will force Australian retailers to up their prices to reflect a more sustainable way of living for local farmers. 

However, he fears if there is no acknowledgement from the industry, more farmers may follow the international route and start shipping their top quality produce overseas for a fairer price.  

Qantas carries up to 50,000 litres of milk to China every week under the two companies trade deal

‘They are willing to pay 5 or 10 times the Australian price because they know it’s safe, it’s green, we put a lot of effort into making a really good product, and it’s a shame that Woolworths and Coles aren’t supporting that.’

‘This is what is going to happen to the industry, I can see yoghurt and cheeses going to nations paying a premium for our product as well.’

Woolworths and Coles have both recently introduced a 10 cent levy on the cost of milk, effective immediately and through to the end of the year, with all proceeds going directly to struggling farmers.

However, in comparison to a market that is paying an exponentially increased amount, the small difference will do little to sway the minds of farmers who are seeking other options, which could in turn impact Australian consumers. 

The 191-year-old company was purchased by Chinese businessman Lu Xianfeng in April 2016 for $280 million

‘We produce nine billion litres of milk a year, and we’re only just covering our own tails with what the Australian market needs. If we all start looking overseas to make profit and get what the product deserves, Australia just won’t have enough,’ Mr Miller said. 

The trade deal comes in the wake of the baby formula scandal, in which Chinese buyers were bulk-buying tins of formula and exporting them out of the country. 

‘They recognise we have a great product here and they’re willing to pay for it. So the question is, why aren’t Australians?’ 

A Coles spokesperson said ‘Coles does not set the prices paid to farmers – Coles pays Australian processors for fresh milk and they set the farmgate price paid to farmers. Raising retail prices would not result in higher prices being paid to farmers.’

Woolworths is yet to comment. 

The Turnbull government agreed to the deal under the pretense that the company would create jobs in Tasmania, and would invest in the protection of the endangered Tasmanian Devil, however a recent mass resignation of the entire Australian board suggests this may never have come to fruition. 

Tasmanian independent MP Andrew Wilkie told The Guardian all of the ‘miraculous promises are unravelling about the selling of VDL to the Chinese’.

‘Instead Australia’s biggest dairy producing asset has become just another Chinese mass production centre for low-value products,’ Wilkie said. ‘No wonder the Australia board is bailing out. Those who opposed the sale were right all along.’  

Mr Xianfeng’s intention with the farm was to export 10 million liters of milk a year to his home town of Ningbo, in eastern China, where the product sells for A$10 – $15 per litre

Read more at DailyMail.co.uk