Australian dairy farmers are taking processing into their own hands

Posted by AFN Staff Writers on 24th October 2016

With many Australian dairy farmers still struggling with low farmgate milk pricing some are starting to take matters into their own hands and are cutting out the middle man.

Instead of selling their milk to large dairy processors, more dairy farmers are now choosing to process the milk themselves, creating their own niche brands available for sale at markets, corner stores and other independent retailers.

One example includes Gippsland Jersey, a new milk brand established in the Gippsland region of Victoria.

Gippsland Jersey came about after Steve Ronalds, a Gippsland dairy farmer, and Sallie Jones, whose father owned a Gippsland dairy farm, decided there was a need to by-pass the big dairy processors after Murray Goulburn and Fonterra decided to drop their farmgate milk prices earlier in 2016.

The farmers set up their own small processing plant (including pasteurisation and bottling in plastic bottles, and began selling their milk in farmers’ markets).

Gippsland Jersey’s motto is telling consumers to ensure dairy farmers get a ‘fair price’ for their milk. A portion of the profits are donated to the Gippsland dairy farming community.

Despite only establishing itself this year, Gippsland Jersey products are already starting to appear in small retailers, cafes and a IGA supermarket.

Crowd funding can lend a helping hand

Crowd funding is playing a role in helping independent dairy processors like Gippsland Jersey get off the ground.

At the moment, Gippsland Jersey is running an online crowd funding campaign, asking for donations and providing donors with small rewards to encourage them to donate.

Another company, Eungelladale, located near Mackay in Queensland, currently sells its own raw bath milk at local stores, but is also using crowd funding to raise money for processing equipment in hopes of making its own drinkable milk.

Equipment leasing can help out

Dairy farmers looking at producing their own products for retail sale need to consider their packaging options, something that might seem like a difficult task.

Many equipment companies are however happy to lease out what dairy farmers will need to start producing their own milk, yoghurt and other dairy products.

Surprisingly, the equipment cost can be less than AUD $200, 000, but obviously ongoing variable costs for packaging, transport and marketing need to be factored in to the final product price. However, mutual community goodwill between farmer and local towns, newspapers, online social media and retailers, offer many opportunities for free or low-cost PR publicity and promotion.

Farmers still need help

Although some dairy farmers are in a financial position, either themselves or by banding together, to start processing and marketing their own milk, other dairy farmers are still struggling to find basic food to put on the table for their own families.

Foodbank Victoria has recently expressed concerns about the severity of the financial squeeze hitting dairy farmers in Victoria very badly. It says it is receiving requests for help from farmers as much as it did during the Millennium Drought.

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