‘How the hell is that fair?’ Australian dairy farmers say milk price offer won’t cover rising costs

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. Photograph: Blake Sharp-Wiggins/The Guardian

Australia’s declining dairy industry is set to contract further than usual this year due 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.