Newsletter of the United Dairyfarmers of Victoria

AUTUMN | MAY 2016

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“Sometimes we work quietly away in the background... this is not one of those times”

Inside this issue

Ü President’s Report

Ü 2016 UDV Conference Resolutions Summary

Ü Cow Loan Scheme Launched

Ü Pathways to Profitable Growth

Ü Meet the UDV Staff

Ü 2016 Policy Council

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A Year of Achievement There are times when it can be difficult for others to identify the merit of the lobby and advocacy work undertaken on behalf of the dairy industry.

Sometimes we work quietly away in the background, sometimes for years on end, without it being obvious to all what we do.

This is not one of those times.

The Victorian dairy industry continues to benefit from active and effective farmer representation at state and national levels. The voice of dairy farmers has been heard on the key issues that matter most and that voice has influenced outcomes.

There has been a number of examples in recent times where state and federal government policy positions have been changed to align with dair y industr y representation. Our voice, the voice of Victoria’s dairy farmers, is being heard where it matters most – by the people making the decisions.

Positive OutcomesAt the state level, dairy industry concerns around some of the original proposals around the sale of the lease of the Port of Melbourne were represented in changes to the final legislation presented to parliament.

The Andrews Government proposed a deal on the sale of the long term lease of the Port of Melbourne with questionable implications for exporters over the next 70 years and given the dairy industry is heavily reliant on the Port being internationally competitive, we were rightly concerned.

The farm lobby worked to ensure the final Bill was amended to include changes to our concerns over the term of the lease, the port rents and licence fees, federal competition oversight, compensation when a second port is built, port rail efficiency, protections against vertical integration and regional and rural access to part of the port sale proceeds.

The state government agreed to what we now believe to be a much fairer deal, including a much larger share of the sale proceeds, given farmers will continue to rely on the Port of Melbourne being internationally competitive for generations to come.

The state government also recognised the arguments that the Goulburn Murray Irrigation District (GMID) Connections project is not working as expected and agreed to a new strategy to get water efficiencies delivered to the maximum number of farms.

Irrigators have grown increasingly anxious about the capacity of management of the irrigation system changes to deliver a system that will be sustainable for the region long into the future whilst meeting the state’s obligations to the Murray Darling Basin Plan objectives.

Minister Neville agreed there was a problem, has proposed a ‘fix’ and put tight timeframes around the next steps. This is a significant and important first step. We recognise there is much to be done but having a government working on solutions with irrigators is an important start.

In Canberra the Turnbull government announced a change to what is known as the Effects Test. This was greeted by relief by the small business, including dairy, because about half of the milk we produce in Victoria is sold on the domestic market. Anything that provides a more balanced and fair relationship with supermarkets must be better for us.

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(Left to right) Young Dairy Farmer Luke Randle, UDV Member Chris Griffin & UDV Policy Councilor Gordon Nicholas at the 2016 UDV Annual Meeting and Conference.

And dairy farmers that employ backpackers were relieved when the Federal government announced a review of what has become known as the Backpacker Tax. The dairy industry, amongst others, believes that with what was proposed, the number of backpackers looking for work on dairy farms would be much lower.

There are other examples, like some of the terrific work done in the ‘People’ space with labour agreements and Visa work, but these are illustrations of the current effective work of state and national farmer organisations.

These follow the success of the dairy industry in securing the strong outcome from the China Free Trade Agreement (ChAFTA). In the past year we were forced to reactivate our efforts to get the required legislation in place to counter a well funded union campaign that was designed to deny the Australian dairy industry an important opportunity to compete in international markets without the burden of unfair and costly tariffs.

The legislation eventually passed through parliament. The result is a significant reduction in the level of tariff paid by the dairy supply chain for product entering China.

In all these examples the dairy industry prioritised an issue, gathered the tools needed for the job to be done, and set about achieving the agreed objective.

Not all the industry work is that public or the results so obvious. A very real example of this is the mountain of work the dairy industry does in managing animal health & welfare issues. Sometimes it’s because there is no publicity the industry has been effective.

Future ChallengesThere is never a shortage of challenges for us to address. That is quickly confirmed by a review of any UDV Policy Council agenda.

The industry continues to be challenged by those who have a different view of our animal welfare and land management practices and access to valuable water resources.

These are issues with direct implications on how we farm. The management of bobby calves, the use of non-therapeutic induction, tail docking, dehorning/disbudding, chemical and fertiliser use, nutrient load management, feeding systems, feed pads and farm sheds and dairies.

All of them have the potential to impact the way we farm now or may wish to farm in the future.

The dairy industry is being proactive and the UDV is playing its role. There is a suite of work that identifies the value of dairy that will support our work into the future.

Industry Information As a starting point, better understanding the financial situation of our farms provides important information for the industry in our dealings with governments and others. The expansion of Dairy Base provides farm size, production type, income and expenditure, and other information that assists industry.

Last year the industry launched the Societal Shapers Program in Gippsland. This is a program designed to assist our community leaders, local, state and federal government representatives, understand the value of dairy in, and to, our regions and local government areas. The program highlights the value of dairy to our towns and communities across the state.

This work has been enhanced by the Pathways to Profitable Growth work that will be launched at this conference. This work seeks to build on the industry Vision work that has been important in assisting us identify and prioritise the blockages facing the future development of the industry.

We understand that a strong milk price is the most important element to underpin future industry growth, but without an appropriate infrastructure to support the continual development the industry needs we will miss important opportunities. We also understand we are in competition for public spending with other industries like tourism, services and manufacturing as well as other agricultural sectors.

Infrastructure is expensive and that provides governments with great challenges because of all of the competing voices. That is why we need to have credible information to support our arguments for government and third party investment.

Governments are listening. The commitment by the state government to continue to contribute to the running of the Agri Bio at La Trobe University was important to the future R& D capability. We need to improve our herd fertility and other animal performance measures. We need more from our pastures.

The dairy industry understands that we can’t afford to stop if we are to succeed. We are in competition with the world.

The Future of Farmer Representation Members will also be aware that through the past year there has been some work done on developing a sustainable structure to ensure the ongoing operations of the National Farmers’ Federation.

The UDV Policy Council has been monitoring this very closely but remains supportive of the objective. At this stage that is all we can do because there is no firm proposal for members to consider.

We would be concerned with any proposal that might further dilute the control the dairy sector has over dairy issues. Decisions on what issues dairy prioritises and how it those issues are funded and managed should be an issue only for dairy.

The fact is dairy farmers have played a critical role in underwriting the financial security of the VFF in recent years. However, what is best for the long term interests of the VFF may not necessarily be in the best interests of the dairy sector. That would present a major conflict should that situation arise.

As we look ahead we understand we have many challenges. But we are well placed to tackle them. The UDV Policy Council is active and a place for robust debate.

We continue to be well supported by members’ membership investment in ensuring we have the necessary tools for active and effective lobby and advocacy, both at state and national level. We thank them for their show of confidence.

We are investing in developing for the future with all Council meetings now attended by at least a couple of younger dairy farmers looking and learning.

Let us not underestimate the challenges we have. But l stand here today reporting outcomes that identify dair y industr y influence.

UDV – Dairy First.

Adam JenkinsUDV President

Over the coming months, UDV will be inviting its members and non-members to have their say about UDV. Your insights will help inform and improve our activity and communications.We would value input from UDV members and the wider dairy community and request they take a short five to 10 minute online survey. By simply participating you will have a chance to win a 16GB iPad Mini 2 Wi-Fi + Cellular.

We will be in touch to invite everybody to share their views on the most pressing issues facing the industry and how UDV can improve.

If we do not have your email address but you would like to participate in the survey, please send through your contact details to ahammond@vff.org.au

iPad mini

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2016 UDV Annual Meeting & Conference

(Left to right) UDV Policy Councilor Oonagh Kilpatrick & UDV Member Duncan Morris.

(Left to right) UDV Life Member Alex Arbuthnot & UDV Member Graeme Anderson.

UDV Member, Noel Campbell.

2016 UDV Annual Conference Delegates at the MCG. Social Licence & the Right to Farm Panel Session.

Luke Wilson, Lead Deputy Secretary for Agriculture - DEDJTR, speaking at the Young Farmer Breakfast.

(Left to right) UDV Member Naomi Pye & Gardiner Dairy Foundation Business Manager, Caitlin Scholfield.

(Left to right) Young Dairy Farmers Ashlee Porter & Georgina Hobson & 2016 NZ Study Tour Participant Luke Randle.

(Left to right) UDV Members Cameron & Rosemary Paton.(Left to right) Social Licence Guest Seakers Jack Holden & Katherine Teh White.

Next Generation Farmers – Yarram BranchAmended Resolution: CARRIED1. That the UDV Policy Council consider the

implementation of two ‘Next Generation Farmers’, per district, to attend all UDV Policy Council meetings in a non-voting capacity, to assist in the transfer of knowledge back to local members, to add valuable input at Council level for policy de velopment and that remuneration, if deemed appropriate, for the ‘Next Generation Farmers’ should be at the discretion of the UDV Policy Council.

Energy- Wannon Branch WITHDRAWN2. That the UDV continue to advocate

Infrastructure Victoria to explore the opportunity to upgrade energy sources in the south west dairy region of Tyrendarra by tapping into the $200m Agriculture Infrastructure and Jobs Fund.

2016 UDV Conference Resolutions Summary

Energy - Wannon Branch CARRIED3. That UDV calls on the State Government to

take responsibility for the funding of a comprehensive upgrade of SWER and single phase lines supplying dairy farms to 3-phase. In doing so seek structured support of regional communit ies , businesses and local government.

Water – West Goulburn WITHDRAWN4. The UDV actively engage with VFF Water

Council to ensure that dair y farm businesses are well represented on all water issues.

Energy - Wannon Dairy Branch CARRIED5. That the UDV pursue with government the

importance and need for 3-phase electricity transmission to be connected to all dairy farming operations in Victoria.

Transport - Wannon Dairy Branch CARRIED6. The UDV Conference supports the

immediate removal of the Road Safety Remuneration Tribunal.

Cow Loan Scheme Launched A novel scheme to renew the Victorian dairy industry was launched last week.The United Dairyfarmers of Victoria announced a proposal for a cow loan scheme at the UDV conference at the Melbourne Cricket Ground.

The UDV Policy Council has developed the proposal to assist young farmers in the industry to buy dairy cows.

It follows a resolution from last year’s conference which was to “initiate discussions with financial institutions to encourage them to recognise the true value of dairy cattle when young farmers enter loan discussions”.

As part of the scheme established farmers would act as unsecured creditors on a young farmer’s cow loan, as it is difficult to get finance to buy cows.

Nuffield scholar and UDV Policy councillor Damian Murphy said the critical element to the success of the program was the goodwill of established farmers. “People think we need regeneration.”

“We need to think about how young people get to the stage where they can buy a farm. If established farmers want to sell their farms, then they need people coming through to buy them.”

He said young farmers might start off as employees, move up to second-in-charge, then farm manager, buy into a sharefarming job, build up cow numbers and sell some cows to buy land.

“There’s a tried-and-true progression and debt is a critical part of it and usually the first part of the debt is the cows.”

Mr Murphy said banks were reluctant to provide loans for cows, although the default rate was low.

He said the UDV would work on the legal side of the arrangement and work with banks to make sure they were comfortable with the scheme.

(Left to right) Allan Oborne and John Miller at the 2016 UDV Annual Meeting and Conference.

Pathways to Profitable Growth

Meet the UDV Staff

Project BackgroundMilk production in Australia has gradually declined since peaking at 11.2bn litres in 2001/02. Despite modest growth in the last couple of seasons, no clear pathway to profitable milk production expansion exists. While many farmers regularly hear and understand the opportunities that are present in local and international markets, for various reasons there has not been a material lift in milk production.

To init iate Austral ian dair y industr y production growth, various parties have circulated aspirational growth targets. Dairy Australia is often expected to offer comment or analyse the potential of these targets being achieved – but there is incomplete analysis around potential growth, and little appetite from those proposing growth targets for independent verification or endorsement.

With this in mind, work has been undertaken to understand the current industry position, postulate scenarios for growth, and inform the discussion around pathways to profitable industry growth. An opportunity exists to integrate this analysis with other work already being done (or planned) to open an informed dialogue between Dairy Australia, the RDP’s, farmers, processors, Government and other industry stakeholders assist investment in programs that create a platform for profitable growth.

Objectives1. Create the analytical framework to assess

historical, present and future scenarios for profitable growth of the Australian dairy industry at a regional level.

2. Build a ‘Pathways to Profitable Growth’ f rame work for each dair y region, identifying what volume targets are achievable and what issues must be addressed in order to achieve these. Infrastructure, employment, investment, p e o p l e c a p a c i t y , fa r m b u s i n e s s management and water policy are examples.

3. Share the Pathways to Profitable Growth framework with stakeholders to assist them to develop an integrated growth plan for their region and provide feedback to DA on potential areas of investment that would facilitate profitable growth. These should become ‘living documents’ that are updated on an annual basis.

4. Integrate these regional plans into ongoing planning cycles to leverage and draw together work already being done that may facilitate profitable growth.

How the data will be used• To develop a consistent narrative around

growth opportunities for the Australian dairy industry at a national and regional level.

• Present a consistent and national picture around what the future Australian dairy industry could look like.

• To leverage existing investments in research and sources of information in Dairy Australia.

• Provide DA and the industry at large with a framework, figures and tools to facilitate future industry growth and inform Dairy Australia, RDP, Processor and Government investment plans.

The UDV team encompasses three staff – UDV Manager, Vin Delahunty, and Project and Policy Officers, Alastair Hilli and Ashlee Hammond.

The UDV staff use a consultative policy development process with the UDV Policy Council (made up of regionally elected dairy farmer representatives), and with dairy farmers across the state. Through discussions & robust debate at regional farmer forums and the Annual Meeting & Conference, the UDV ensures the policies developed, endorsed and implemented best meet the interests of UDV members.

The internal UDV policy structure has created a system that ensures effective and efficient policy direction with the following five policy focus areas:

Vin Delahunty – Animal Health & Welfare

Ashlee Hammond – Farming Systems & Herd Improvement and People and Human Capacity

Alastair Hilli – Markets Trade & Value Chain and Natural Resource Management

We value our dairy farmers’ feedback, as we strive to continuously improve our advocacy and policies to meet their best interests.

CONTACT USVin Delahunty, UDV Manager Ph: (03) 9207 5602M: 0468 995 355E: vdelahunty@vff.org.au

Alastair Hilli, Project and Policy OfficerPh: (03) 9207 5572M: 0448 038 901E: ahilli@vff.org.au

Ashlee Hammond, Project and Policy OfficerPh: (03) 9207 5556M: 0427 979 095E: ahammond@vff.org.au

(Left to right) UDV Staff Ashlee Hammond, Vin Delahunty and Alastair Hilli.

Disclaimer: This publication is provided in good faith and as a guide only. It may be of assistance to you, but the VFF/UDV does not guarantee that the publication is without flaw of any kind or is wholly appropriate for your particular purposes and therefore disclaims all liability for any error, loss or consequence that may arise from you relying on any information in this publication.

United Dairyfarmers of VictoriaFarrer House 24-28 Collins Street Melbourne 3000 | ABN 67 079 980 304Ph. 1300 882 833 | Fax. 03 9207 5500 | E-mail. vff@vff.org.au | www.vff.org.au

2016 Policy Council The UDV thanks the following

supporters of the 2016 UDV Conference

UDV Conference Partnerr

UDV Presidents’ Dinner Sponsor

Luncheon Sponsor

Young Farmer Breakfast Sponsor

Session Sponsors

The Policy Councillors are your representatives to shape the policy of the UDV. Farmers are encouraged to contact them when you have issues of concern in your region.

PRESIDENTAdam JenkinsSouth Purumbete 0437 008 806ajenkins@vff.org.au

VICE PRESIDENTJohn VerstedenLongwarry 0407 343 111jlv@dcsi.net.au

REGION 1John KeelyCohuna 0417 351 260burniff@gmail.com

REGION 2Gemma MonkSt. Germains 0427 538 778gemma.monk1@bigpond.com

REGION 3 Daryl HoeyKatunga 0407 582 982dmlhoey@bigpond.com

REGION 4Gordon NicholasBiggara 0458 760 512g_nich55@hotmail.com

REGION 5 Paul MumfordWon Wron 0438 890 222mumfordpl@bigpond.com

REGION 6 Damian MurphyDumbalk North 0458 645 437dtmurphy@activ8.net.au

REGION 9Nick RenyardTimboon 0419 316 850n_renyard@bigpond.com

REGION 10Oonagh KilpatrickKoroit 0417 331 354oonaghkilpatrick@yahoo.co.uk