Latest news with #milkprices
Reuters
4 days ago
- Business
- Reuters
Dairy farm cooperatives settle milk price-fixing lawsuit for $34 million
July 25 (Reuters) - Two dairy farm cooperatives have agreed to pay a combined $34 million to resolve a proposed class action accusing them of conspiring to fix milk prices in Texas, New Mexico and other parts of the southwestern United States. The preliminary settlement, opens new tab was filed on Thursday in federal court in New Mexico and requires a judge's approval. Dairy Farmers of America will pay $24.5 million and Select Milk Producers agreed to pay $9.9 million, the settlement papers showed. Cooperatives play a central role in the marketing of milk and other dairy products in the United States. Dairy farmers who filed the lawsuit in 2022 said the two cooperatives underpaid them for the production of raw fluid Grade A milk, in violation of U.S. antitrust law. Dairy Farmers of America and Select Milk Producers have denied any wrongdoing. In a statement, Dairy Farmers of America said 'the unique complexity of the case — combined with escalating costs and ongoing disruption — made resolving this now the prudent path forward,' and that settling allowed the organization to focus on its mission. The plaintiffs' attorneys declined to comment. A lawyer for Select Milk did not immediately respond to requests for comment. Lawyers for the plaintiffs in a court filing called the proposed settlement amount 'significant,' and said it will end potentially risky further litigation over whether the lawsuit can move ahead as a class action. The settlement includes certain dairy farmers who produced and sold Grade A milk in parts of Kansas, Oklahoma, Arizona, Texas and New Mexico from January 2015 through June 2025. Dairy Farmers of America in 2015 agreed to pay $50 million to resolve a class action from farmers in the northeastern United States accusing the cooperative of conspiring to suppress milk prices. The cooperative settled a similar case in 2013 for $140 million involving farmers in the southeastern United States. The case is Othart Dairy Farms LLC v. Dairy Farmers of America Inc et al, U.S. District Court for the District of New Mexico, No. 2:22-cv-00251-SMD-DLM. For plaintiffs: W. Joseph Bruckner and Brian Clark of Lockridge Grindal Nauen; Steve Berman and Shana Scarlett of Hagens Berman Sobol Shapiro; and David Scott and Patrick McGahan of Scott + Scott Attorneys at Law For Dairy Farmers of America: Alfred Pfeiffer Jr and Sarah Ray of Latham & Watkins; and W. Todd Miller of Baker & Miller Read more: US poultry producers sued by growers over hiring and pay Deere must face FTC's antitrust lawsuit over repair costs, US judge rules Pilgrim's Pride agrees to pay $41 mln to settle investors' lawsuit Dairy collectives must face farmers' milk price-fixing lawsuit, US judge rules
RNZ News
6 days ago
- Business
- RNZ News
Farmers 'going hell for leather' to take advantage of high prices
Rosalind Crickett said it looked like dairy farmers were "going hell for leather" as they took advantage of high milk prices. Photo: 123rf Some milk processing factories are bursting at the seams as huge volumes of milk are trucked to their plants, according to a dairy analyst at NZX. Rosalind Crickett says there was a record collection of milk solids last month - nearly 18 percent more than the same time last year. It was also nearly 12.5 percent higher than the last five years' average. Crickett said it looked like dairy farmers were also "going hell for leather" as they took advantage of high milk prices. Crickett described June's national milk collections as "off to a flying start" with 23,956,000kg of milk solids collected - a record for the month and surpassing expectations. While off a low base, the figure marked a 17.8 percent year-on-year (YoY) leap on June 2024, and a 14.8 percent improvement on the previous record (June 2022). There were 261,000 tonnes of milk collected in June, also a record, with the figure up 14.6 percent YoY and up 9.9 percent on the rolling average of 238,000 tonnes. This month's milk supply was also expected to be up by 10 percent, partly due to lush pasture growth particularly in the South Island, where not as many farmers dry off at this time of the year compared to further north. Butter - getting expensive. Photo: Margaret Jaszowska for Unsplash But would so much milk arriving at processing plants lead to a drop in the price of locally sold butter for consumers ? Crickett said that would depend on how much milk was able to be processed in other countries next month and sold in international auctions at the same time as New Zealand. "If there is not as much in the northern hemisphere, it's because we are seeing drought across Europe impacting their grain production for cattle feed. And we are seeing water supply issues as well. "That will be a price support for New Zealand products because they are going to need to export more to make up for that deficit globally." She said grass conditions seemed to be set up well for the spring flush with an overwhelming abundance of moisture in the ground, but avoiding pugging damage may become a headache for farmers before then. However, the large quantity of milk produced was expected to continue, and Cricket said it would be interesting to see what transpired. Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
The Guardian
15-06-2025
- Business
- The Guardian
‘How the hell is that fair?': Australian dairy farmers say milk price offer won't cover rising costs
Australia's declining dairy industry is set to contract further than usual this year thanks to a combination of natural disasters, rising costs of production and lower than expected minimum farm-gate milk prices. Advocates warn the low milk price offer may be the last straw for many farmers, especially the 1,900 – almost half of all dairy farmers in Australia – struggling with the financial and emotional toll of severe drought in Victoria and South Australia, or extreme flooding in New South Wales. Opening milk prices of $8.40-$9.20 per kilogram of milk solids (MS) – the non-water components of milk such as milk fat and protein – released in June by processors – are slightly higher than 2024's starting point, but lower than 2023. Farmers received an average of $9.79/kg MS for their milk in 2023-2024. Sign up to receive Guardian Australia's fortnightly Rural Network email newsletter Despite the emotional and financial turmoil in the fields, consumers are unlikely to notice much difference in the retail price of dairy products. Major supermarkets Coles, Woolworths and Aldi use milk as a loss leader, and set the price expectations. Any shortfalls in supply will be made up with imports from overseas or interstate where farm gate prices are lower. The Australian Dairy Farmers president, Ben Bennett, who farms at Pomborneit in south-west Victoria, says prices below $9/kg are less than the cost of production and fail to recognise the impact of higher global markets, inflation, or the cost of responding to drought and a one-in-500-year flood. Many farmers had already lost hundreds of thousands of dollars in 2024-2025, a figure Bennett expects to be dwarfed in the coming financial year as producers are forced to sell cattle to buy feed. 'Some dairy farmers just won't be able to endure this latest blow and they'll have to exit the industry,' Bennett says. The Victorian Farmers Federation United Dairyfarmers of Victoria president, Bernie Free, has a dairy at drought-affected Warrnambool and told Guardian Australia last month that he was hand feeding – supplying silage and other fodder to his 650 friesians to make up for the lack of grass – more than he ever had in his 30 years on the land. He says $10/kg MS would be enough to cover increasing costs of production 'if we didn't have drought'. 'On my farm, and every other farm in western Victoria and South Australia, we don't have any grass growing,' he says. 'We're going to be short of grass fibre to feed our cows all the way through until the autumn break next year, and we've got 10 or 11 months of worrying about where we're going to get feed for our cows.' The Norco chair, Michael Jeffery, whose entire farm at Kempsey in northern NSW was inundated by the May floods, is now spending $30,000 a week on hay to hand feed more than 500 cows and heifers. He will use drones to try to sow seed into paddocks that are still too wet to drive on in a bid to get some pasture growing before spring, and faces a bill of 'hundreds of thousands of dollars' to repair damage to laneways. Jeffery estimates the cost of the floods to his business at $1.1m. Norco, which is a co-operative wholly owned by about 300 members on 190 farms in northern NSW and south-east Queensland, calculates its prices differently because it focuses on the fresh milk market. It is forecasting an average of 90c a litre, which equates to about $12.45/kg MS. The company is also working on separate measures to help its flood-affected suppliers. Jeffery says the opening figures from some major processors were misleading because they were weighted averages and 'completely unachievable in reality'. 'Our headline price is an actual average based on supplier profile and a bit over half a cent better than our main competitors, assuming full quality,' he says. 'Given the recent commodity values, I agree [$9/kg] is lower than what would be expected in Victoria.' The president of eastAUSmilk, Joe Bradley, says prices less than $9/kg were disappointing and unsustainable, showing the major processors and supermarkets undervalued milk. Bradley milks 200 cows at Dayboro, north-west of Brisbane. 'Farmers are saying to me: the processors keep telling us the price is good, demand is going up and this is as good as it gets,' he says. 'The price of hay has gone through the roof, and our costs keep going up, yet we don't get a price increase … how the hell is that fair?' Under the Dairy Code of Conduct, which took effect in 2020, processors are required to publish milk supply agreements and minimum prices for the next season – along with the reasons – on their websites by the first business day in June. Companies can adjust pricing during the season, announcing step-ups to pay a higher price when market conditions improve. Rabobank senior dairy analyst Michael Harvey says opening prices were broadly in line with his expectations of a $9/kg minimum, published in the annual Australian Dairy Market Outlook released a week earlier. This was on the back of a 25% rise in the Global Dairy Trade index during 2024-2025. 'More importantly, the milk actually doesn't start coming in and being sold into the market until the spring peak,' he says. 'As the season progresses, if the market plays out the way we expect, there will be upside from here.' Harvey says he understands the frustration of farmers, but companies need to find the right balance, given global uncertainty. The number of registered dairy farms in Australia fell from 6,308 in 2014 to 3,889 in 2024, a drop of 38%. Over the same period, milk production declined from 9.421bn litres to 8.376bn litres. In the biggest milk producing state, Victoria, 2,552 dairy farmers produced 5.297bn litres, more than 63% of the national total in 2023-2024. Despite the gradual decline in production, dairy remains Australia's third biggest rural industry by farm-gate value and exports, behind red meat and wheat, according to figures from Dairy Australia. Sandra Godwin is a freelance journalist based in Swan Hill, Victoria Sign up for the Rural Network email newsletter
ABC News
07-06-2025
- Business
- ABC News
WA dairy farmers dismayed at 'stagnant' milk prices amid rising costs
West Australian dairy farmers say they are disappointed by the ongoing stagnation of farmgate milk prices as repeated dry seasons and rising costs take a toll. Processors recently published their 2025-26 supply agreements as part of transparency measures in the Dairy Industry Code of Conduct. For the third successive year, WA processors have been offered no substantive price increase. The disappointment was shared by interstate producers, where processors have offered slight increases. Dairy farmers in WA's South West have called on local milk processors to review their offers, with one major processor, Bega, already conceding to a two-cent-per-litre rise. Brunswick dairy farmer Michael Partridge said the initial price offered by Bega was not enough. "Prices haven't moved for three and a half years; last year was a really hard year for farmers in Western Australia," he said. "The Dairy Farm Performance Program, which Dairy Australia did, showed 50 per cent of dairy farmers made a loss, and there was an average 2 per cent return on investment, and the prices didn't move, which was extremely disappointing." Though 2-cents-per-litre extra from Bega was not enough, Mr Partridge said it was a start. "I was pleased to hear that Bega has announced a 2-cent price rise, but it's not enough to turn the industry around," he said. He called on other big processors to do the same. "We really need the other two processors, Brownes and Lactalis, to follow suit, and push it further," he said. WAFarmers Dairy Council president Ian Noakes, who also runs a dairy in the south west of the state, said the stagnation of pricing ignored the fact that production costs had risen substantially for dairies. Mr Noakes said his lobby group was seeking a 5-cent increase to support farmers to be profitable. He said WA's average farmgate price ranged between 60-70 cents per litre, and that pricing hadn't materially changed in the last three years. While East Coast dairies had access to overseas export markets, WA's dairy farmers were constrained to a comparatively small, local market. For that reason, Mr Noakes partially blamed the major supermarkets' low-priced home brand milk ranges for the subdued pricing offered by WA processors. Mr Noakes recently presented to an ACCC inquiry into Australia's major supermarkets, urging the regulator to recognise the damage of home brand milk ranges. The ABC contacted WA's major dairy processors for comment, of which Coles was the only one to respond. "We introduced a direct sourcing model for our own brand milk in 2019 to ensure we could provide fair, competitive and guaranteed farm gate prices to dairy farmers directly," a Coles spokesperson said in a statement. "Our multi-year agreements for our direct supply dairy farmers aim to support them in longer-term planning, and as part of the process of setting these agreements, we consider a range of factors including supply volumes, customer demand, farm production costs, and dairy market condition,s including commodity prices." Harvey Fresh's parent company, Lactalis, declined to comment, and Brownes and Bega were yet to respond.
ABC News
05-06-2025
- Business
- ABC News
Last Eungella dairy farm closing as milk becomes 'cheaper than water'
As the morning sun pierces a patchy fog, Dale and Paula Fortescue herd their dairy cows into their mountaintop milking shed for perhaps the last time. The couple are the last dairy farmers at Eungella, west of Mackay, an area that was once home to about 60 dairies. They have operated the Eungelladale dairy for 17 years and, despite "unbelievable" community support, they have decided to close once they have filled the last of the bottles in stock. Mr Fortescue said rising production costs, low consumer prices, and two years of wet weather had made it impossible for the farm to turn a profit. "It was a big decision, but we think it's the right one," he said. The Fortescues are not the only Queensland dairy farmers leaving the industry, according to advocacy group eastAUSmilk. Chief executive Joe Bradley said the number of Queensland dairy farmers had fallen from 1,500 to 220 in the past 25 years. "The costs have gone through the roof, and what we receive for our product hasn't kept pace, and people are leaving the industry." "That really destroyed the price of milk, and they keep that at a ridiculously low level, which then devalues the whole of dairy," he said. Mr Bradley said the whole supply chain had been under stress since milk became "cheaper than water". "The problem is that because the returns on dairy have been so low for so long now, no farmers have money put away for a disaster or a downturn, and now every time you get some sort of an incident, people have no option but to shut up shop," he said. Federal Agriculture Minister Julie Collins said the government's mandatory Food and Grocery Code of Conduct came into effect from April this year to help support the industry. She said the new code would address the imbalance between supermarkets and suppliers, particularly the smaller ones. Ms Collins said the government was also reviewing the Dairy Code of Conduct to ensure it worked "as intended and remains fit for purpose". In an attempt to be profitable, Eungelladale dairy switched from supplying larger brands to producing its own milk on-site to escape some of the pressure from low industry prices. But Mr Fortescue said the savings were not enough to see them through when consecutive wet years disrupted milk production. Eungella Chalet manager Tess Ford said it had been a privilege to use "beautiful" local milk on her menu. She said it would be sorely missed. "I'm devastated," she said. "It's been a pleasure dealing with Dale and Paula, and it's very sad to see them go. Ms Ford said it also raised questions about who would supply milk to her business. "It's going to be a bit of a challenge to find a supplier; only certain people will come to Eungella to deliver," she said. Mr Bradley said Australia was at risk of becoming a net importer of dairy from as early as this year. "A third of production has dropped in Australia, and it's only going to get worse," he said. "Farmers just want a fair return for their product." Although Mr Fortescue hopes he can pivot his farm into beef production, the last days of dairy farming will be bittersweet. "People let big business roll over the top of everything you do," he said. "So, the last dairy in Eungella says goodbye. "And unfortunately, that's how it goes."
