The ADF has heard from Minister Joyce that he will be convening a symposium on
dairy issues as part of the Coalitions election commitments. The ADF will be working hard with state organisation members over the next few weeks
to prepare for the Symposium.

We expect it will provide an opportunity to discuss the major issues facing the industry including $ milk, fair contract terms and conditions, a world
dairy commodity pricing index, issues in WA where some farmers have been given notice of not being picked up and backpacker tax, to name a few of the
high priority issues.

While we have welcomed the Governments support package we continue to urge changes to the criteria for access to most elements of the Governments support
package, particularly the concessional loans package.

The plan announced in the lead up to the 2016 election, included $555 million in concessional loans with 10-year loan terms, $20 million for an upgrade
to Gippsland irrigation infrastructure, $2 million to establish a commodity milk price index and $1.8 million to provide business and financial counselling.

I urge all farmers to not self-assess whether they are eligible for the concessional loans support package. We know many have had difficulty with access
and we have been able to use some of these experiences in our ongoing discussions with the Department for changes to the eligibility criteria.

The Prime Minister and Deputy Prime Minister will be meeting with the Murray Goulburn Board to discuss the global and domestic challenges facing Australian
dairy farmers. It will be interesting to hear the outcome of this meeting. Mr. Joyce will then convene the dairy farmer symposium with the Department
of Agriculture and Water Resources

The ongoing support and commitment of government is essential for us to successfully navigate through these trying times so we are able to provide innovative
and practical solutions to help farmers achieve a sustainable level of profitability. We need to ensure that the solutions we present are in our farmers’
best interests, so they can take control of their situation and make informed choices.

ADF thanks Barnaby Joyce for maintaining this election promise and his continued commitment to seeking solutions to the current dairy situation.

David Basham

Acting ADF President

2016 is proving to be a year of contradictions for Australian dairy farmers.

As I spent a few days in Western Australia this week, I was reminded of the significant challenges we are facing right across the country and the remarkable
resilience dairy farmers are showing in times of hardship.

Western Australian dairy farmers have mostly been buffered from export oriented market volatility and have experienced a good season, yet they are not
immune from other difficulties. Bushfires impacted the region and a growing oversupply in the domestic milk market led to processors telling farmers
they’re no longer required. With limited options of processors that suppliers can shift to, these dairy farmers face an uncertain future.

ADF has been working with WA Farmers, processors and government, to help find a solution for these farmers as we know there are strong opportunities for
the WA dairy industry.

Reflecting sentiments right across the country, it was heartening to see the amount of support for the industry at the WA Farmers Conference on Thursday.
Even when we are under pressure, we are an industry that has the know-how and motivation to overcome these adversities and thrive in the long term.

No one is alone in these scenarios and we need to ensure that all farmers feel supported during tough times.

Over the past few years there have been examples in all states where decisions of some processors have severely affected farmers and reinforced the vulnerability
of dairy farmers’ market position. It is unsustainable and unacceptable to expect that farmers continue to bear the full weight of financial risk in
the supply chain.

We are working, and will continue to work, with all states to find a better way to balance this risk and improve transparency for the long-term, sustainable
profit and ultimately, survival of the whole industry.

David Basham

Acting ADF President

After ten days of vote counting, this week Australian Dairy Farmers (ADF) congratulates
the Coalition Government on its re-election.

As an industry, dairy has enjoyed a constructive relationship with the Coalition throughout its previous term, and we look forward to continuing that spirit
of this engagement.

With the election behind us, promises made can now be translated into concrete action.

Although the ministry will not be sworn in until next week, ADF has already met with the Department of Agriculture’s advisors to progress the roll out
of key support measures announced in the Dairy Support Package. In particular we continue to highlight the urgency in providing immediate access for
all affected farmers to Concessional Loans and the Farm Household Allowance support.

Importantly, concerns raised by farmers who have been working to access these measures, including by share farmers, are being taken seriously and will
continue to be progressed with the government.

We will continue to work with the Coalition and the opposition to address other key priorities for the dairy industry also, including implementing an effects
test to better balance market power throughout the supply chain, invest in rural research and development to build resilience, ensure secure access
to sustainable water resources and support a national strategy to address technical barriers to trade.

Over the coming weeks, the ADF policy advisory groups will continue to meet in Melbourne to cement our priorities for the new government. Building industry
resilience, as well as addressing the lack of transparency throughout the supply chain are on our agenda.

July has begun the same way June came to an end – with wild weather and floods challenging many dairying regions and low milk prices meaning revised budgets
and planning across all farms.

As we work together to weather these storms we must remember that we are a resilient industry with a long, sustainable future ahead. Our profitability
and therefore resilience as an industry depends greatly on the support of the Australian public.

We must continue to remind the community that dairy farmers – regardless of the challenges they face are good business people, who care for their cows,
work to enhance the wellbeing of their people and that every efficiency we make on farm has ties to minimising our impact of the environment.

David Basham

Acting ADF President

With the official announcement of last weekend’s election yet to be made, the
dairy sector (like the rest of the nation) is watching very closely and working to ensure that all political parties understand our priorities. Whatever
the outcome, it is essential that stability reigns – effective policy formation and clear action to overcome challenges will be otherwise impossible.

Australian Dairy Farmers (ADF) has made clear its priorities for the next government – extend and streamline access to the concessional loans and Farm
Household Assistance for all affected farmers, create a safer, more resilient workforce, ensure secure sustainable access to water resources and above
all, address the imbalance of market power within the dairy supply chain.

It’s good to see that all parties have recognised the importance of supporting our farmers through the current challenge, as well as committing to developing
innovative solutions to building long term sustainability of our industry.

However, it is concerning to see some are still calling for a fresh milk levy – an unworkable solution. If a fresh milk levy was imposed, it would potentially
result in farmers who supply domestic markets subsidising their export market oriented counterparts. This is not a workable solution.

There are also potential difficulties associated with such a levy breaching Australian Competition and Consumer Commission regulations as well as potential
issues with the World Trade Organisation.

The fundamental issue our farmers continue to face is that they wear the bulk of financial risk in the dairy supply chain. We need a practical and viable
solution to increase transparency in the way the milk pricing system works and to simplify milk contracts to ensure the volatility of the market is
better balanced along the supply chain.

This week UDV and ADF met with farmers in South West Victoria – to hear concerns, answer questions and build feedback about the current supply chain into
our policy work. This is one of many meetings ADF will continue to participate in throughout the year, to ensure we are effectively representing farmers’
interests.

The discussion was robust. Overall, the consensus in the room was that trust has been broken and we need to find a way forward.

The challenges faced by farmers in Western Australia due to processor decisions reinforce the sector as a whole is enduring tough times – no state is immune.

Collaboration is what will get us to where we need to be. Our industry relies on all the elements to operate effectively. Farmers need processors and vice
versa – so the solutions will require input from all parties.

Beyond this the public and the government ignore us if we do not operate as one. If we have a hung parliament, dairy will need parliamentary champions to advocate our policy priorities and the industry must work together to feed them that case.

David Basham

Acting ADF President

Opening milk price announcements made this week by Murray Goulburn and Fonterra have
once again, reinforced the need for improved transparency in the way milk pricing is structured and communicated in Australia.

Not only are the announcements much too late for farmers to properly budget and plan around, but many questions have to be asked to understand them. Add
to the already complex system a loan repayment and the forecast opening price is far from what it first appears.

Both Murray Goulburn and Fonterra’s recent announcements are confusing and difficult to understand – they lack clarity and transparency.

Improving the transparency of the milk pricing system is important, and Australian Dairy Farmers (ADF) continues to work with our state members to this
end. It is essential that processors come to the table and discuss this as a collective, to help protect the future of our sector.

No one can dispute that the current market situation for dairy farmers, whether you are a supplier to the export or domestic market, is rough. Even the
best placed businesses will be making difficult decisions.

While we cannot change the milk price, ADF is working hard with our state members to improve the transparency in the milk pricing system and simplify milk
contracts. We are also fighting for farmers to better manage the risk throughout the supply chain so that they do not always bear the financial risk.

This weekend Australia takes to the polls and by next week the successful party will be moving into Parliament. ADF and our state members will be back
in Canberra as soon as the elected party is announced to keep the pressure on.

As an industry dairy has supported its own and will continue to do so. We’ve never asked for a bail out but rather for targeted assistance that will help
get our industry over the current hurdle and better balance risk throughout the supply chain going forward. We need structural change that improves
fairness and brings more balance into the market – competition law can be improved more.

ADF acknowledges the Dairy Recovery Concessional Loans are now available in SA, TAS and Victoria. We welcome this support, and will continue to advocate
that all affected dairy workers are eligible for this assistance.

I encourage all farmers to keep talking to ADF, your state representatives and RDPs. It’s tough for everyone out there right now, and the season ahead
will be challenging. This will go beyond the farm gate, with our service providers and communities likely to feel the pinch too – keep this in mind
and let’s all look out for one another.

David Basham 

Acting ADF President

Australian Dairy Farmers’ (ADF) first priority in recent months has been
to secure support for our industry led initiatives, and targeted assistance from Federal and State Government to help see farmers through the short
term cash flow crisis. It is frustrating that this has created the expectation of immediate relief yet some farmers are not eligible. We continue to
lobby strong on farmers’ behalf to secure access for all affected farmers to Dairy Recovery Loans, now available in Victoria and Tasmania. We expect
criteria to be released imminently in South Australia and New South Wales.

Many farmers have been calling the ADF and state dairy farming offices to discuss these assistance mechanisms, and highlight accessibility issues. We encourage
all concerned farmers to keep these communication channels flowing as it is vital for ADF to know which issues to target.

As an industry, we are going beyond these short term measures to create stability for our industry’s long term future. Central to this is finding new ways
to manage price volatility for farmers.

ADF in collaboration with our state members has long advocated the need for competition policy reform that addresses the unequal balance of market power
in the supply chain with not only a Mandatory Code of Conduct to control said power, but also a Supermarket Ombudsman to effectively regulate the code.
We have made important in roads in the last two years, but there is still work to be done.

Ideas developed through the Markets, Trade and Value Chain meeting last week are being progressed and work with the Australian Competition and Consumer
Commission is gaining traction.

All three major political parties have come to the table to discuss potential solutions over recent weeks, and this is to be commended. It is essential
that this movement does not stop at political rhetoric, but rather translate to real and tangible changes for our industry.

Ensuring issues that affect our entire sector’s ongoing productivity and competitiveness are on the Federal political agenda remains equally important
during these tough times.

In particular, ADF continues to seek commitments from all political parties to support dairy’s access to secure, affordable water resources. While recent
rainfall has been a welcome reprieve for many regions the long term outlook for water allocations remains bleak. ADF continues to push for vital changes
to the Murray Darling Basin Plan and environmental water trading to make certain enough water is available when farmers need it and at an affordable
price.

Funding for dedicated agricultural health services and resources is urgently required to safeguard the wellbeing of our workforce. Federal Government should
make ongoing commitments to vital resources including the National Centre for Farmer Health to match that of State Government.

We continue to work closely with the National Farmers Federation to accelerate agriculture by addressing key workforce issues including the scrapping of
the backpacker tax, as well as supporting industry’s efforts to reduce carbon emissions intensity.

Ensuring these priority areas are addressed in the upcoming election will enable our industry to take control of its own destiny, and develop a stronger,
more prosperous and sustainable future.

Australian dairy farmers know we’re not immune to significant market forces such as the slowdown in the Chinese economy, or the Russian ban on importing
product. But the low prices announced recently will be below the cost of production for many farmers. While some have faced such volatility before
their current situation is no doubt compounded by the unprecedented challenges driven by processor decisions in the 2015-16 financial year.

ADF continues to work with all our state members – QDO, NSWFarmers, SADA, TFGA, UDV and WAFarmers as well as industry partners to hold State
and Federal Government to their promises of support, and to drive real, meaningful change throughout the supply chain for the betterment of our industry.
Together we are stronger than we will ever be divided – and united we will support farmers through the challenges they currently face.

David Basham

Acting ADF President

Australian Dairy Farmers’ (ADF) first priority in recent months has been
to secure support for our industry led initiatives, and targeted assistance from Federal and State Government to help see farmers through the short
term cash flow crisis. It is frustrating that this has created the expectation of immediate relief yet some farmers are not eligible. We continue to
lobby strong on farmers’ behalf to secure access for all affected farmers to Dairy Recovery Loans, now available in Victoria and Tasmania. We expect
criteria to be released imminently in South Australia and New South Wales.

Many farmers have been calling the ADF and state dairy farming offices to discuss these assistance mechanisms, and highlight accessibility issues. We encourage
all concerned farmers to keep these communication channels flowing as it is vital for ADF to know which issues to target.

As an industry, we are going beyond these short term measures to create stability for our industry’s long term future. Central to this is finding new ways
to manage price volatility for farmers.

ADF in collaboration with our state members has long advocated the need for competition policy reform that addresses the unequal balance of market power
in the supply chain with not only a Mandatory Code of Conduct to control said power, but also a Supermarket Ombudsman to effectively regulate the code.
We have made important in roads in the last two years, but there is still work to be done.

Ideas developed through the Markets, Trade and Value Chain meeting last week are being progressed and work with the Australian Competition and Consumer
Commission is gaining traction.

All three major political parties have come to the table to discuss potential solutions over recent weeks, and this is to be commended. It is essential
that this movement does not stop at political rhetoric, but rather translate to real and tangible changes for our industry.

Ensuring issues that affect our entire sector’s ongoing productivity and competitiveness are on the Federal political agenda remains equally important
during these tough times.

In particular, ADF continues to seek commitments from all political parties to support dairy’s access to secure, affordable water resources. While recent
rainfall has been a welcome reprieve for many regions the long term outlook for water allocations remains bleak. ADF continues to push for vital changes
to the Murray Darling Basin Plan and environmental water trading to make certain enough water is available when farmers need it and at an affordable
price.

Funding for dedicated agricultural health services and resources is urgently required to safeguard the wellbeing of our workforce. Federal Government should
make ongoing commitments to vital resources including the National Centre for Farmer Health to match that of State Government.

We continue to work closely with the National Farmers Federation to accelerate agriculture by addressing key workforce issues including the scrapping of
the backpacker tax, as well as supporting industry’s efforts to reduce carbon emissions intensity.

Ensuring these priority areas are addressed in the upcoming election will enable our industry to take control of its own destiny, and develop a stronger,
more prosperous and sustainable future.

Australian dairy farmers know we’re not immune to significant market forces such as the slowdown in the Chinese economy, or the Russian ban on importing
product. But the low prices announced recently will be below the cost of production for many farmers. While some have faced such volatility before
their current situation is no doubt compounded by the unprecedented challenges driven by processor decisions in the 2015-16 financial year.

ADF continues to work with all our state members – QDO, NSWFarmers, SADA, TFGA, UDV and WAFarmers as well as industry partners to hold State
and Federal Government to their promises of support, and to drive real, meaningful change throughout the supply chain for the betterment of our industry.
Together we are stronger than we will ever be divided – and united we will support farmers through the challenges they currently face.

David Basham

Acting ADF President

The first priority over the last few weeks has been to secure targeted assistance and roll
out support to help farmers with their most pressing needs.

At the same time, we remain focused on the big picture – especially when it comes to water. It won’t be enough to help farmers get over this hurdle if
their businesses later fall over because water is too scarce and expensive to stay milking in seasons to come.

We can’t control the weather. The recent rains are a welcome reprieve, but to make a substantial difference to the bleak outlook on water allocations for
next season it will need to keep raining heavily in the catchments over the next few months..

So while we watch the skies, our priority remains achieving long-term objectives on what can be controlled. Environmental water trading, the Murray Darling
Basin Plan and the Connections reset all have an important bearing on whether enough water will be available when farmers need it and at a price they
can afford in 2016/17 and beyond.

We are advocating for State and Federal Government commitments to assist our industry by making more water available next season. Potential untapped sources
include trade in northern Victorian allocations to urban centres such as Melbourne, as well as a share of the environmental water held in Victorian
and Commonwealth accounts.

The amendments to the Federal Water Act last month mean that the Commonwealth Environmental Water Holder (CEWH) now has more flexibility to trade water
it may not need. As of 31 March, the CEWH still had just over 300 GL in storage; while it has no plans to trade in 2016-17 at this stage, this may
change as part of environmental planning now underway.

We also remain focused on the Connections reset. The announcement that only $388 million is left to deliver more than 100 GL savings was unwelcome news
at a time when farmers already have so much on their plates. Now more than ever, we must get this reset right to provide sustainable infrastructure
for a resilient dairy industry.

Once the election is over, we will be back in Canberra to keep the pressure on the elected party to achieve the Murray Darling Basin Plan’s environmental
outcomes without removing any more water from irrigated agriculture.

State and Commonwealth Governments have an in-principle agreement to deliver the full 650GL in environmental offsets, and undertake more robust socio-economic
assessment before any attempt to achieve more than the 2750 GL target. We are holding them to all of these commitments.

ADF has welcomed back well respected former CEO, John McQueen in an interim role after
the departure of Benjamin Stapley, who resigned last week.

As CEO for over 20 years, Mr McQueen stepped down in 2007 – however dairy was never far from his thoughts as a senior agriculture advisor to past Prime
Ministers Kevin Rudd and Julia Gillard and recently in his independent consultancy.

Prior to his time at the helm of ADF, John held the position of CEO at the Australian Dairy Herd Improvement Scheme (ADHIS). John also spent time working
with ABC-TV’s Science Unit, producing, researching and directing programs such as the first three series of Towards 2000.

Mr McQueen’s significant policy expertise, strong industry relationships and political connections are a very welcome addition to the team at ADF, which
is working hard to support farmers through a period of unprecedented challenges.

Outcomes-focused, non-prescriptive is a mantra that John is proud of and will continue to be part his approach in his return to ADF.

Dairy farmer representatives on the ADF Markets, Trade and Value Chain Policy Advisory
Group (PAG) gathered in Melbourne this week to discuss a range of measures to establish a fairer, more transparent dairy market.

Simplifying supplier contracts and agreements featured heavily and methods to make them simpler and more transparent. Further to this the lack of transparency
regarding milk pricing, and its ability to be retrospective is unacceptable and must be addressed.

The PAG also reviewed the methods to give clear, independent and credible market and price signals to dairy farmers and how this might be practically applied
to the Australian dairy market.

Providing farmers with the right tools and resources to manage the opportunities and risks associated with a fluctuating dairy market was also a focus
to help bolster the industry’s resilience in the long term.

Significantly, the meeting agreed upon the need to modernise the Australian industry’s pricing structures and contracts to recognise the complex operating
environment that farmers face, to better balance financial risk along the supply chain. ADF is working with all state members, levels of Government
and industry to achieve these endeavours.

ADF continues to press for the release of the full dairy support package as soon as possible and will update farmers as soon as this information is released.

We have had a couple of operational changes at ADF in recent weeks, with the resignation of ADF CEO Benjamin Stapley announced yesterday. The ADF Board
has already taken steps to ensure that the role of CEO is well served in both the short and long term.

Contact has already been made with former ADF CEO John McQueen, now an industry consultant, to step into this important leadership role on an interim basis
while the recruitment process is completed. Mr McQueen steps into the role as early as Monday morning and there will be a smooth, effective transition
so no time is lost in fulfilling ADF’s mission to lobby for a stronger future for Australian dairy farmers.

These are unprecedented times and we need to ensure we have the right leadership balance to effectively address these issues, while not losing sight of
other priorities important to building farmers long term sustainability.

The small team at ADF, remains committed to driving strong policy to transform the way our industry operates for the better.

Many farmers have been calling our offices in recent weeks seeking advice, assistance and information on what ADF is doing on their behalf. We encourage
you to keep connecting with ADF to ensure we effectively represent your interests.

David Basham

Acting ADF President

Representatives from Australian Dairy Farmers (ADF) embarked on a series of national roadshows beginning in Tasmania on 4 May, in partnership with state
dairy farming members.

Comprised of a series of farmer focused forums across the course of 2016, the roadshow offers farmers the opportunity to engage with national and state
dairy member representatives on the issues most important to them and their region.

The roadshow is also an opportunity to get up to speed on progress and developments which have occurred over the past year, as well as talking through
the industry’s election priorities for 2016.

ADF Senior Policy Manager, David Losberg said the regional forums would provide farmers with the opportunity to discuss the issues of critical importance
to their region.

“Our industry is experiencing unprecedented challenges at present and we want our members and the public to engage with us, and ensure their interests
are effectively represented. Our aim for these forums is to help provide clarity on the policy support mechanisms secured on farmers’ behalf and facilitate
opportunities to make recommendations for future improvements.”

“Now more than ever it’s important that our farmers know who is representing their interests, and that we are tirelessly working on your behalf with minimal
resources to gain the results farmers need to be successful in businesses and provide succession opportunities.”

Since May, ADF has visited dairy regions in Tasmania, New South Wales and Queensland. Queensland Dairyfarmers Organisation President, Brian Tessmann said
the forums were a valuable opportunity for members to air their thoughts and express their needs to the people who represent them.

“The ADF Roadshows are always useful and insightful for our Queensland farmer members. The most recent events in Warwick and Maleny were extremely timely
and helpful for our members who had a number of national industry questions given the situation down south.”

“It is important that we continue to work closely with ADF to continue getting results for our members at a national level and events such as these ensure
that ADF have the opportunity to hear directly from Queensland farmers.”

The next roadshow forum takes place in Western Australia on 26 July. For more information on the roadshow schedule or any other details please contact
Shona McPherson, ADF Media Officer via media@australiandairyfarmers.com.au or mobile 0447
293 844.

Representatives from ADF and QDO speak with farmers at the Maleny Dairy event in June. 

Keeping Australian dairy in business for the long term. This was the catch-phrase
of the Australian Dairy Industry Sustainability Framework when it was first endorsed by the Australian Dairy Industry Council (ADIC) in 2012.

This long term thinking is especially relevant today, says the Chair of the Framework’s Steering Committee, Chris Griffin, a Gippsland dairy farmer.

“The Australian dairy industry is facing unprecedented challenges, yet securing our industry’s triple bottom line approach to sustainability remains as important as ever,” Chris says.

“Although the industry’s immediate priority is to support dairy farmers through the recent step downs, the Framework helps us keep an eye on the horizon.
Importantly it tracks our progress and drives practice change where necessary to ensure the industry is sustainable for the long term.”

In June, the ADIC was recognised for its sustainability framework by the United Nations Association of Australia (UNAA) with its 2016 Organisation Leadership Award.

Judges said that the Framework was “exceptional and inspiring, particularly its whole-of-supply-chain focus; rigorous targets and reporting; impacts to
date; stakeholder and community involvement; and communication”. They also recognised the Framework’s potential to act as a model for other whole-of-industry
approaches for an even broader impact.

Further acknowledgement of the value of the Framework and support for dairy farmers’ commitment to sustainable production comes from Ian McConnell at WWF
Australia, a member of a stakeholder reference group for the project, the Dairy Sustainability Consultative Forum.

“The value of the Framework is helping the dairy industry to know where the pressure points are coming from,” says Ian.

“By being in front of the issues, the industry can better shape its response. And when issues do emerge, such as pricing or producer profitability, it
can be in more control and shape the conversation.

“It’s not just about the milk. The Framework helps Australian dairy to tell the wider story about the industry and its producers.”

Whenever a dairy farmer takes steps to improve their business or their practices, or reduces their environmental impact, they are contributing to the industry’s
progress on sustainability under the Framework,” says Chris.

“The challenge is to make sure we are focussed on targets that will deliver the best outcomes for the industry, the community and the environment.”

For more information, visit www.dairysustainabilityoz.com.au