Dairy industry leader says the biggest issue for dairying is "competing land use"

EastAUSmilk president Matthew Trace's comments follow the news that North Burnett dairy farmer, Robbie Radel and his family, were leaving the industry after more than 117 years.

Mr Radel made the announcement on social media that he was ceasing operation of the family farm and branded product, Central Queensland Dairy Fresh.

On the social media post, Mr Radel said he started his own brand some years ago because of the low farm gate prices that Paul's Parmalat (now Lactalis) was paying.

He said when a contract to buy Cooloola Milk where his milk was being processed fell through he approached Lactalis "as a last resort" to see if they would collect his milk, but was told they were not prepared to take him on as a supplier.

"Walking away from a 5-generation family owned and run dairy farming business that has been in operation for 117 years...is something we never imagined we would have to do...especially not by being forced out due to lack of somewhere to send high quality milk in a country that is now a net importer of dairy products," he said.

Mr Trace said he could not comment on the specifics of the situation between Mr Radel and Lactalis.

But he believed the Lactalis Central Queensland milk run was viable at the moment and there was potential for some of the dairy farms to grow to make the run more viable.

"It's probably really a litmus test of how viable dairying is in all of Queensland because physically a lot of milk can be produced in that Central Queensland region," he said.

Mr Trace said it had been viable for Lactalis to transport the milk to South Brisbane and Nambour since the closure of the Rockhampton plant.

"And my understanding is that they want to continue to take milk from that region," he said.

"I think they need all the milk they can get in Queensland and while it's a little way away from the factory it is a pool of milk and they have some long term suppliers there," he said.

Mr Trace said there was a huge demand for dairy products in Queensland and that demand was growing.

"There's a deficit of production so we have got a market situation that favours the farmers to actually produce more and all the processors are asking their farmers if they would like to produce more to go ahead and do it," he said.

"We have had a significantly increased price over the last couple of years for the farm gate milk price.

"Obviously, the cost of production has also gone up, but we have seen a significant increase in price so it's not all doom and gloom."

Mr Trace said the real issue for the dairy industry was not whether farmers could pay their bills right now, but competing land use from hobby farmers, investors, the beef and sugar industries to buy dairy country.

"So it's more about the competing land use (of dairy country) than 'is dairying viable?' because dairying is viable at the moment.

"I am not saying it's easy. I'm a dairy farmer. It's not easy, but it is viable - it's that competing land use that's the biggest issue."

On Friday, again through social media, Mr Radel said he did not support a boycott of any particular branded milk over the matter of him leaving the industry.

"The people who produce the milk at home, the other dairy farmers, don't deserve the backlash out of this," he said.

In a written statement, Lactalis said: "We were one of many dairy processors that the farmer approached and we are deeply saddened to hear that the farmer is now closing their dairy farm".

"At the time that the enquiry was made to Lactalis on July 17, 2023, we had sufficient milk to meet our requirements," the spokesperson said.

"Under the Dairy Code of Conduct we are obliged to publish our Milk Supply Agreements, by 2pm on June 1 and have the Milk Supply Agreements finalised with each of our farmers by the start of the new milk season commencing on July 1."