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Dairy profitability and sustainability linked

BY ANDREW ALDRIDGE, AUSTRALIAN DAIRY FARMERS FARM OPERATIONS POLICY ADVISORY GROUP CHAIR

Aussie dairy farmers are doing a bloody good job when it comes to environmental sustainability. But like marathon runners competing against folks doing their first couch-to-5k, those personal best records aren’t going to fall as easily and in as big an increment as those just getting started.

We need to recognise that back in 2012 we were the first Australian ag industry to have the foresight to set up a sustainability framework that covers our livelihoods, human nutrition, our animals and the environment. That since then we’ve made big gains, and that while we’ll continue to make gains, they’ll be increasingly incremental.

Sure, the latest Australian Dairy Sustainability Framework report figures are looking pretty good, but the reality is what we’re going to see from now on are incremental gains. It’s not because we’re not doing enough, but rather because we’ve done so much already.

Today more than 70 per cent of Australian dairy farmers have implemented energy efficiency projects or used renewable energy and 83pc have fenced off all natural waterways.

We’re also making new commitments, such as agriculture’s first industry action plan for halving food waste and a roadmap to improve the sustainability of the packaging of dairy products by 2025.

Of course, we need to keep going: farmers have traditionally been custodians of their land and environment, as demonstrated by organisations such as Landcare, which started more than 30 years ago! We now see it has become a focal point for global and domestic consumers and markets.

But we need everyone to recognise that the next gains are going to be tough, and we need to balance our business viability alongside our environmental investment.

Trust is strong in dairy industry

It’s encouraging to see consumer support for dairy reflected in the framework report. The Dairy Trust Tracker Survey shows that is strong, with almost eight in 10 Australians of the belief dairy is essential for good health and wellbeing.

In 2023 the dairy industry also welcomed the release of a study that quantified the health and financial benefits that could flow from increasing the servings of dairy in the diets of aged-care residents. Essentially, consumers know dairy is good for them. And they should feel good about consuming dairy, too.

As we look to 2024, we need to make sure we continue to do our bit for the environment, but we also need to make sure that consumers understand our bottom lines must also be sustainable.

“It’s incredibly hard to be green if you’re in the red”, as they say.

To keep producing food that is nutritious, good for our health and wellbeing and sustainable, it must also be commercially viable – we must be able to turn a profit like any business, otherwise we are not going to be here long.

Essentially, we need regulators and shoppers to recognise the good work we’ve done and when comparing our produce with countries that don’t have the standards we do be willing to pay for the sustainability progress we have achieved.

That’s not all we need to do. We need the whole supply chain to do its bit and not just to look at farmers for the easy gains.

We need to be real about the promise of the new income streams for adapting and mitigating climate change.

Sure, these may be great for some, but for a lot of us already doing good environmental work, we’ve done it. It’s not new, so we won’t be rewarded or will need to keep the gains to shore up our post-gate credentials.

We need to ensure farmers’ interests are represented when new well-considered environmental policies and regulations that impact us are being set. These must recognise that due to the industry’s front foot approach that a scalpel is needed not a chainsaw.

Perhaps most importantly, we need to keep our eye on those personal best scores, not just for the environment but for long-term profitability as well. Whatever the world (or nature, for that matter) throws at us, we need to keep doing what we do best, continually evolving and improving what we do and ensuring we have a dairy industry that not only cares for the environment but which makes sense financially too.

To download the 2023 Sustainability Report, visit https://australiandairyfarmers.com.au/adsf/.

Policy & Advocacy, Sustainability

Ag needs a seat at the Murray Darling Basin table

BY ANN GARDINER, ADF Water Committee Chair

People who should be making decisions on an issue should be the closest to it, and I can tell you right now Canberra is a long way from the Murray Darling Basin (MDB).

Last week the Restoring our Rivers Bill got the support it needed to pass the Senate, and what worries me most is that it’s people far away from the MDB that have had the most say in its future.

Trust me, the Minister said when we met with her two weeks ago in Sydney. But to be honest with you, trust doesn’t go all that far when it comes to politics.

That’s why we’re calling for an ag industry advisory group to be appointed to play a role in the implementation of this legislation.

When ADF’s president and CEO then met with the Federal Water Minister Tanya Plibersek on the same day the Senate support was secured they made it clear to her that this was what was needed.

In representing dairy farmers at these meetings, we have collectively expressed our significant concerns to the Minister about the Bill and the risks it poses to our industry, our farmers, and our regional communities. We explained to her that this is all coming when milk production is at an industry 30-year low.

We also sought details on the new amendments to the Bill. The Bill passed the Senate with minor amendments that included a consideration of socio-economic impacts and options to lease water to the environmental water holder as an alternative to buybacks.

The industry advisory group could help ensure that the government genuinely engages with industry in the implementation and rollout of the new legislation.

The group would endeavour to minimise the negative impacts of buybacks by ensuring ongoing government accountability including the consideration and reporting of socio-economic impacts. It would aim to ensure that “all options are on the table” just as the Minister has said, not just buybacks, and would provide valuable input into these options.

Further, the group could provide input into the inevitable community assistance packages that will be required from structural change because of buybacks.

Our continued aim is to ensure that dairy farmers have a seat at the table. Much as we may not like buybacks, and the potential damage they will do to industry, better to be there trying to mitigate this damage than just throw our hands in the air and walk away.

Twenty per cent of the nation’s total milk production comes from the Murray Darling Basin region. It is home to 912 farms and 42 dairy processing facilities, creating almost 7000 jobs and generating about $2 billion of value to the region and local communities.

Since the introduction of the MDB Plan in 2012, dairy farm numbers in the region have fallen by 47 per cent and raw milk production has dropped by 35 per cent.

We need a healthy dairy industry in the Murray Darling Basin.

If more farmers leave, those left behind are going to struggle. Fewer farmers mean the burden of maintaining irrigation infrastructure falls on the dwindling numbers left behind. It means fewer kids in schools and less money spent at local stores.

It also means less milk produced, and higher prices at the supermarket for Aussie families. Our dairy exports will take a hit.

But don’t get me wrong. We’re disappointed, yes. We’re worried, absolutely. But we’re also optimistic. We know there are innovative solutions that deliver water for the environment that don’t involve damaging buybacks.

If Minister Plibersek wants us to trust her, then she needs to trust us back, and establish an agricultural industry advisory group that guides implementation in a way that allows us to use our knowledge and understanding of the basin and delivers projects without negative consequences to communities and agricultural production.

Let’s get an advisory group in place, let’s listen to the people whose lives and livelihoods depend on the Murray Darling Basin, and let’s do what we can to get this right.

Climate change, Public Health, Sustainability

Dairy: good for people and planet

By DARYL HOEY*

Agriculture and in particular livestock production has been central to formal global talks about sustainable food production and healthy diets hosted by the United Nations in past weeks.

There have been passionate voices on food, biodiversity and climate. Mostly, these voices have respected all dimensions of sustainable food production from cultural and economic to nutrition and environment.

For our part Australian dairy has a long history in sustainability and is committed to being part of the solution to the world’s biggest sustainability challenges, including climate change and food insecurity.

First and foremost, an unhealthy diet is not sustainable. Our industry nourishes people across the world daily. Milk, cheese and yoghurt are nutrient-rich with proven health benefits.  Dairy is a staple food with traditions woven into society. It’s affordable and accessible meaning it can be part of many cultural diets.

Seventy-nine per cent of Australians agree that dairy foods are essential for good health and wellbeing,

Dairy has and always will be a food – not a fad.

As an industry Australian dairy stands for a healthier world, for people and the planet.

It is not lost on us that livestock industries such as dairy contribute methane to the atmosphere from cow burping. These gases are short-lived relative to those from fossil fuels however there is still an opportunity for us to improve our performance and do more to protect the environment in which we operate.

It’s in our nature – and in our hands – to action on climate change; 94% of Australian dairy farms have implemented practices to reduce greenhouse gas emissions (GHGs) and GHGs from manufacturers are down 27% since 2010/11, according to the 2020 Australian Dairy Industry Sustainability Report. The report also shows that 93% of waste from manufacturers is diverted from landfill. We are committed to meeting the challenge of climate change and looking after our natural resources.

In relation to economic development Australian dairy is committed to creating a vibrant industry that rewards dairy workers and their families, their related dairying communities, business and investors.

Dairy provides jobs and income for many families and contributes to social cohesion in regional communities. Eighty-six per cent of people in regional areas think dairy is an essential part of their community.

In 2019/2020, Australian dairy processors generated $15.7 billion in revenue and contributed $12.4 billion to Australian GDP. The industry directly employs 42,600 people. It brings regional communities to life.

Australia’s dairy farmers and manufacturers are innovative. We think ahead. This enables us to be part of the solution to food and agriculture’s biggest sustainability challenges, now and in the future.

The Australian Dairy Sustainability Framework sets out what we do to reward our people, make nutritious products, care for our animals, and leave the environment in better shape for the future.

We report our progress towards sustainability goals and targets every year for all to see. Our sustainability promise is to produce nutritious food for a healthier world. It’s a promise we aim to keep.

If people planning the future of food take into account the social, economic and environmental impacts of food production Australian dairy will be part of whatever food system emerges over time.

* Daryl Hoey is Chair of the Dairy Sustainability Steering Committee, which directs the Australian Dairy Sustainability Framework, a whole-of-industry initiative from the Australian Dairy Industry Council.

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