The Senate Committee on Economics has released its long awaited report into the Australian Dairy Industry. Following the collapse of milk markets in 2016 and retrospective price cuts affecting farmers, the integrity of the dairy industry became the focus of the Senate Inquiry. The crisis was fuelled by a reliance on the international market and large power imbalances in contractual design between milk producers and processors. The Committee was also tasked specifically with looking at the behaviour of Murray-Goulburn as a company that imposed retrospective debts on dairy suppliers at the height of the crisis in the 2015-16 season. Notably, the Committee questioned whether Murray-Goulburn’s current capital structure is in its member’s best interests.
The Committee made the following recommendations:
The ACCC will release their report into dairy industry practices by 1 November 2017. The Committee’s Report in full can be read here.
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