AUS: National Foods strikes Tasmania milk price deal

By ausfoodnews.com.au | 21 December 2009

An amicable deal has been struck between Tasmanian farmers and dairy processor National Foods today (21 December), concluding a long-running saga that had become bitter on occasions.

Farmers had - until today - continued to back away from the price offered by National Foods, arguing farmers were paid more in other states and the offer price would not meet their costs of production.

However, National Foods held firm, arguing its proposed milk price was the best it could do without undermining the sustainability of its business.

And, while talks had been fruitless for the past couple of months, there was a hint of a breakthrough last week as both parties sought a quick resolution. A meeting in Melbourne saw the farmers bargaining group and National Foods progress toward a new deal, with today's meeting finally realising a solution.

The Farmers' Collective Bargaining group informed the ABC that they would recommend farmers sign the new contracts with National Foods.

"We've reached an agreement on a fair and open system of comparing the National Foods price to (Tasmania's other major milk processor) Fonterra," spokesman Phil Beattie said.

"We're delighted that National Foods are displaying a much more friendly and helpful approach to our dealings, and we're really hopeful for National Foods being the processor of choice in the future.

"What's happened is that we've changed to being like a Fonterra supplier, but with really quite good premiums above supplying Fonterra. So while in the really, really bad times, we will suffer, we won't suffer quite so badly."

Australian Food News is Australia's leading resource for the food industry, delivering daily news from the grocery, retail and hospitality sectors to 40,000 professionals each month. http://www.ausfoodnews.com.au/

Sectors: Commodities & ingredients, Dairy

Companies: National Foods, Fonterra