Building on the popular Good Bulls Guide, the new Good Bulls app makes it easier than ever for dairy farmers to identify bulls that match their breeding
priorities.

Drawing from an expansive database of local and international dairy bulls, the Good Bulls App allows bulls to be sorted on Australia’s three breeding indices: Balanced Performance Index (BPI), Health Weighted Index (HWI) and Type Weighted Index (TWI).

Up to 50 filters can be used to find bulls that match your breeding objectives. Bulls can be filtered by any trait (e.g. protein, cell count, fertility
or mammary system) or by semen company, pedigree, genetic characteristics and other factors.

The app provides detailed ABVs on each bull making it easy to compare between bulls and shortlist bulls of interest. Shortlisted bulls can be exported
to a trusted advisor to facilitate semen purchasing decisions.

Dan Knee, who milks 400 cows at Toora, Vic was one of the test users in the app development. “The App is great. It makes it quicker and easier to
identify bulls with the traits that are important to me. It has turned a job that once took hours into a simple, fun task,” he said.

Sarah Saxton, from the Australian Dairy Herd Improvement Scheme (ADHIS), said the app would be updated twice a year with the April and August release
of Australian Breeding Values (ABVs).

The app is available for both iphone and android.
For details on the app visit www.adhis.com.au/goodbulls

There has been a lot of discussion about investment for a stronger future this month, with a great deal of excitement generated by recent investments in
Australian dairy.

Such investment will have positive impacts for farming communities.Investors may be interested in further value added opportunities for milk processing.
This could be a generator of new growth and development for the whole industry. Investment that passes our foreign investment regulatory tests continue
to the benefit of Australian dairy.

Importantly, our industry recognises that this stronger future depends equally on economic, environmental and social outcomes. Dairy continues to hold
itself accountable by not waiting for change to occur, but by initiating positive change ourselves. The industry’s progress is highlighted by the Sustainability
Framework’s 2015 Progress Report – set to be released shortly via www.sustainabledairyoz.com.au.

It was my great pleasure to discuss the industry’s performance against the key targets with the Department of Agriculture and Water Resources in late February
at the Canberra Dairy Forum, and to share more about our industry’s commitment to retaining our social licence to operate.

I encourage you all to take a look at the Progress Report when it is released in mid-march and provide feedback.

Part of tackling sustainability challenges and helping the industry demonstrate performance to the Australian community, is investing in agile representative
structures. On the heels of a period of significant policy achievement, ADF is in the strongest position it has ever been. Much of this we owe to our
2012 restructure which helped build greater transparency and engagement with key stakeholders, particularly decision makers in government.

We recognise that there is room to further improve our representative models, to ensure that we can continue to effectively advocate on behalf of all dairy
farmers in all dairying regions. The proposed National Farmers’ Federation’s restructure has begun this conversation and ADF looks forward to furthering
this discussion to ensure dairy representation has a future that maintains currency, relevance and accountability.

Simone Jolliffe

ADF President

Competition law has been the focus of a Government overhaul over the past fiver years, with the intention of preventing situations such as the $1 per litre
milk campaign – a damaging state of affairs for dairy farmers which highlighted the significant imbalance of market power between retailers and suppliers
in the grocery supply chain.

In its discussion paper on the Options to Strengthen the Misuse of Market Power Law, Australian Dairy Farmers (ADF) once
again emphasised the need for an ‘effects test’ to be inserted into Australia’s Competition Law.

Without an effects test the current tactics and actions of the major retailers will continue to result in substantial lessening of competition in the market
place. This means a significant impact on the viability of proprietary branded dairy products, less product variety on supermarket shelves, less choice
and in the long term, higher prices for consumers.

The Australian Competition and Consumer Commission (ACCC) must be
given the ability to examine the effect of such strategies, with particular emphasis on the impact on competition (including small businesses like
corner stores and regional supply chains), consumer choice, farmer viability and future prices.

Of the six options proposed to amend the current misuse of market power provisions, ADF believes the most practical option proposes that the existing provision
be amended by removing the words ‘take advantage’. The law would be amended with the wording, ‘purpose, effect or likely effect of substantially lessening
competition’ test.

However, ADF does not agree with the inclusion of the ‘purpose’ element due to the practical difficulties of proving purpose. Inclusion of the purpose
element and defence as outlined in the Harper Review recommendation 30 may make the effects test unworkable in reality.

An effects test is in line with competition policy around the world – almost all western nations, except for Australia and New Zealand have an effects
test.

There is strong support for the proposed changes to the effects test, from competition experts, including the Harper Review Panel, the ACCC, former Chairmen
of the ACCC, Rod Sims as well as small businesses, suppliers and farmers across Australia.

ADF will continue to advocate for stronger misuse of market power laws to foster a more competitive business environment. To view ADF’s submission to the
discussion paper, click here.

Extreme weather conditions in February continue to challenge farmers across all dairying regions. Bushfires in Tasmania and Western Australia have impacted
dairy farms. As farm businesses may be affected by elements beyond their control, preparing for threats is essential to protect your family, staff,
livestock and business. ADF’s primary focus is to ensure famers are equipped with fundamental information and to work with its state members with recovery
efforts.

To access resources and tools to help manage extreme weather events, refer to Dairy Australia’s website here.

Australian Dairy Farmers (ADF) has joined the National Farmers Federation (NFF) in calling for the Federal Government to halt the proposed backpacker tax.

As part of the 2015 Federal Budget the government announced that from 1 July 2016 all working holiday makers will be taxed at a rate of 32.5 per cent on
all income.

ADF President Simone Jolliffe said that dairy farmers rely on backpackers for vital on-farm roles which cannot be filled locally or to complement their
existing workforce during peak times.

“The dairy industry is suffering a skilled labour shortage which means that we need overseas workers, such as backpackers, when we cannot find suitable
local staff,” Ms Jolliffe said.

“If this tax is brought in as it currently stands, backpackers may choose to travel to other countries such as New Zealand.”

“This would be damaging to the dairy industry, regional communities and the tourism industry, as well as the broader economy.”

Backpackers currently earn, on average, about $15,000 while in Australia, and may be eligible to claim the tax-free threshold.

“ADF believes it is fair and reasonable for backpackers to pay some tax, but 32.5c is excessive,” Ms Jolliffe said.

“We are supporting NFF’s position that 19 per cent, achieved through deactivation of the tax-free threshold, is fairer to both backpackers and the agricultural
industry which relies on them.”

We encourage everyone who understands the significant contribution backpackers make to agriculture to support NFF’s campaign by signing an online petition.

To join the petition, go to https://www.change.org/p/australian-government-stop-the-backpacker-tax

The official signing of the Trans Pacific Partnership (TPP) in Auckland, on 4 February has been welcomed by the Australian Dairy Industry Council (ADIC).
The signing follows an agreement reached between the twelve negotiating countries on 6 October 2015.

The TPP made some gains made for the Australian dairy industry in improving opportunities in key export markets such as Japan.

The conclusion of the TPP continues a historic period of increased trade liberalisation over the past few years.

Following the signing ceremony, Australia must now go through a domestic ratification process. This means that before any binding treaty action is taken,
the TPP text and a National Interest Analysis will be tabled in Parliament for 20 joint sitting days.

The Joint Standing Committee on Treaties (JSCOT) will conduct an inquiry into the TPP and report back to Parliament on ‘matters arising from the TPP treaty
and related National Interest Analysis and proposed treaty actions presented or deemed to be presented to the Parliament.’

The ADIC will provide a submission to the inquiry.

Welcome to the New Year. I hope you have all had the chance for a short break at least, and are ready to work together to tackle the challenges and
opportunities that 2016 brings.

In recent years, Australian Dairy Farmers (ADF) has strengthened dairy’s ties with Canberra to raise the profile of the issues that matter most to
our farmers. ADF has maintained our reputation of acting apolitically, being accessible to all politicians, and being willing to listen.

This year we will continue to build this profile, while simultaneously building on our capacity to deliver value to members.

So far in 2016, key members of the ADF team have visited members in central New South Wales. In February our CEO will visit Western Australia – to
talk and listen about priorities for the year ahead. These are the first of many 2016 interstate meetings to follow.

I encourage you to take the opportunity and introduce yourself to our team. The passion and commitment that the ADF staff has to help achieve a stronger
future for our industry is evident, and we are all prepared to listen to your thoughts, ideas and constructive feedback.

The beginning of the year has been challenging for farmers. Extreme weather conditions brought drought or very dry conditions in Tasmania, West Victoria,
South Australia as well as savage bushfires in Western Australia. ADF is seeking to assist its state members with recovery efforts. I commend the
efforts of WA Farmers, Western Dairy and Dairy Australia, in providing practical support and counsel to the affected farmers in WA.

Events like these are a timely reminder that so many aspects of our business are affected by elements beyond our control. ADF is committed to ensure
that farmers have the information and resources they need to take control of what they can. Dairy Australia also has a great resource of tools
and information to assist in preparation and recovery.

In February, ADF will host an environmental scanning and industry planning workshop with key stakeholders such as our state members and Dairy Australia.
These sessions will aid in setting our advocacy priorities for 2016, to establish a sound policy platform which ensures we can capitalise upon
growth opportunities delivered by 2015’s advocacy.

I look forward to getting out and about in order to meet with as many members and non-members as possible over the course of 2016 to ensure ADF can
continue to deliver value for the industry.

Simone Jolliffe

ADF President

January 26, 2016 marks five years since Coles’ supermarket dropped the price of its home brand milk to $1 per litre, igniting a price war with Woolworths
that reduced the value of milk to an unsustainable level.

Australian Dairy Farmers (ADF) has continued calls for the Federal Cabinet to adopt stronger misuse of market power laws to foster a more competitive business
environment.

ADF President, Simone Jolliffe said there have been important breakthroughs for competition policy since 2011.

“The introduction of the Food and Grocery Code, which included a large number of ADF’s recommendations, was a constructive first step toward fostering
a more competitive business environment.

Further to this the Australian Government’s support for key recommendations from the Harper Review of Competition Policy is extremely positive,” Mrs Jolliffe
said.

“ADF also welcomed the announcement in the Agricultural Competitiveness White Paper of $11.4 million over four years to boost the ACCC’s engagement with
the agriculture sector including a new Agricultural Engagement Unit.”

However, Mrs Jolliffe said the industry would continue to advocate for improved transparency regarding the impact of retailer actions on suppliers. ADF
also continues to advocate for the regulating bodies to have the power to prevent predatory pricing in future. 

“ADF also strongly supports the Harper Review’s recommendations for any updated competition and consumer law to include an effects test,” Mrs Jolliffe
said.

“Addressing the misuse of market power is crucial in determining the Australian dairy industry’s future profitability and sustainability.”

Mrs Jolliffe encouraged consumers seeking to show their support for farmers to “buy branded”.

“The more branded milk we buy the more money stays in our dairy value chain. By keeping these dollars in the value chain dairy has the capacity to reinvest
in industry research and innovation – which helps to strengthen our farmers, improving their efficiency and prospects of long term sustainability.

Buying branded means investing in choice for consumers on our supermarket shelves and in the future of our dairy farmers. This Australia Day – show your
support by buying branded.

Key Points 

• National policy to phase out calving induction
• Improved breeding programs to lift fertility and support farmers through the policy change
• Learning from NZ approach
• Targeted assistance and advice to be provided to farmers impacted

Caring for cows is always a key priority for Australian dairy farmers and our industry. The industry is dedicated to providing a high standard of care
for our animals, and to changing practices when in the best interests of our livestock.

In April 2015, following a series of meetings and consultation with farmers, vets and processors the dairy industry agreed to phase-out routine calving
induction nationally.

Revised Policy

Australian Dairy Farmers (ADF), Dairy Australia, vets and processors have since been working on implementing the revised policy which is:

“ADF does not support routine calving induction and will work to phase it out through improved herd improvement practices, tools and technologies.”

Calving induction is already reducing in Australia and the dairy industry’s breeding programs such as InCalf and the improvement of fertility by genetic
selection are making a difference.

A Steering Group, including dairy farmers, representatives from the Australian Cattle Veterinarians, Dairy Australia and the Australian Dairy Products
Federation (ADPF), was established to progress the phase-out.

A data survey of veterinary practices performing inductions was undertaken in 2015. The results confirm estimates from previous farmer surveys that the
number of cows induced is declining. It is estimated that in 2015 less than 1.5% of the national herd were induced (approximately 24,000 cows) however
there is considerable variation between farms and regions.

The industry is now working to reduce even further the number of cows induced.

Target for 2016

After reviewing the 2015 induction data, ADFwill introduce a target for 2016 that routine calving induction will be limited to a maximum of 15% of cows
within a herd unless a dispensation has been granted.

The 15% limit will apply unless a fertility management plan has been implemented or dispensation is granted for exceptional circumstances beyond a farmers
control such as herd health issues, severe weather events (floods, fire), AB failure as well as other issues.

An ‘Oversight and Engagement’ Panel including representatives from ADF, the Australian Cattle Vets and ADPF has been formed. The panel, with support from
Dairy Australia, will establish guidelines and consider requests for exemptions exceeding the 15% target set for 2016. Whilst there is no legal requirement
on dairy farmers to achieve the 15% target the dairy industry is seeking to achieve industry-wide practice that is over and above the legal requirements
and is confident farmers will adopt the recommended voluntary industry targets as the phase-out progresses.

Farmers will apply to the Oversight and Engagement Panel via their vet for special dispensation to carry out inductions in excess of the 15% limit for
routine calving inductions.

The Steering Group will work with the Oversight and Engagement Panel to monitor progress and review the target each year in order to establish updated
annual targets.

Industry Programs

Improving herd fertility is a fundamental requirement to reduce the need for routine calving induction and it also delivers many benefits for farm profitability
and resilience. The industry is working closely with veterinarians and reproduction advisors to ensure advice and services are available to assist
farmers with fertility management.

Industry programs such as InCalf, the Repro Right network and InCharge Workshops will be enhanced and the industry will provide targeted reproduction advice
to those farmers most in need.

New Zealand

The New Zealand dairy industry has phased out routine calving induction over a period of time and has banned the practice as of 1 June 2015. The industry
is liaising with counterparts in New Zealand to understand and learn from their approach; in particular the setting of annual limits with a dispensation
process.

Late Calving Induction

A particular concern recognised by industry has been the use of late calving induction. ADF is aware that several veterinary practices no longer perform
late calving inductions, as they provide no reproductive benefit. Late inductions (performed within 4-6 weeks of the due calving date) provide no overall
reproductive benefit for the herd and should not be performed except for the welfare of the cow or her calf.

Early pregnancy testing is required by these practices to make sure late inductions are not occurring.

ADF will continue to consult with farmers, veterinarians, state organisations and other stakeholders to ensure that the timing, process and outcomes are
right for animals and farmers.

*Routine calving induction is all non-therapeutic inductions

Over the course of 2015, the Australian Dairy Industry Council (ADIC) increased its advocacy focus on the impacts of the Murray Darling Basin Plan (MDBP)
and the need for changes to the Plan and its implementation.

Significant achievements were made in 2015 with the Federal Government committing to legislation to cap water buybacks in the MDBP at 1500 gigalitres (GL).
Further, indications that more flexibility will be provided for environmental water trading were welcome. However, the ADIC still has concerns regarding
the MDBP’s unrealistic timelines as well as a lack of planned transition and structural adjustment.

2016 is a critical year in the Plan’s implementation. The deadline for the Sustainable Diversion Limit (SDL) adjustment mechanism is imminent. Progress
with state offset projects leading up to this June 2016 review is also of significant concern.

Secure access to quality water is paramount to dairy’s future. Reduced access to the water resources the industry relies on will impact dairy’s profitability,
productivity and international reputation. To ensure that the dairy industry’s key priorities are effectively represented and addressed in this discussion,
the ADIC has re-formed its Water Taskforce.

The ADIC Water Taskforce, chaired by Victorian dairyfarmer Daryl Hoey, provides a cross-industry group to support the ADIC in driving for pro-dairy solutions
in current and future opportunities for review and change.

The priorities of the Taskforce for 2016 are to seek a review and delay the 450GL ‘upwater’ as part of a stock take to better understand the effects (both
positive and negative) of water recovery. Further, the Taskforce will also push for the delivery of the full 650 GL in environmental offsets to ensure
any shortfall does not have to be covered by farmers. Other targets include a more transparent water market and information as well as ongoing monitoring
and support for regional and state water programs including the Northern Basin and Menindee Lakes and Connections Reviews.

For further information about the ADIC’s Water Taskforce contact the ADF Office via (03) 8621 4200.

Over the course of 2015, Australian Dairy Farmers (ADF), together with state members and industry partners has worked collaboratively with government to
broker new trade deals which increase access to key Asian markets hungry for safe, clean and sustainable Australian dairy produce.

ADF welcomed the China-Australia Free Trade Agreement (FTA) which entered into force on 20 December 2015, followed quickly by a second round of tariff
reductions on 1 January 2016.

Also on New Year’s Day, the Korea-Australia FTA progressed to its third year of benefits for dairy exporters, meaning further tariff reductions and increased
quotas for a range of Australian dairy exports.

Similarly, the Malaysia-Australia FTA moved into its fourth year of implementation, translating to further increased liquid milk tariff rate quotas. The
Thai-Australia and US-Australia FTA’s also celebrated a milestone in passing the 10 year point, and provided improved duty free quotas for Australian
dairy.

Further to this, the finalisation of the Trans-Pacific Partnership negotiations in late 2015, plus the late December announcement of an agreement to abolish
government subsidies on agricultural exports through the World Trade Organisation.

The Australian dairy industry still faces challenges in its export focused markets, especially with regard to technical barriers to trade which translate
to higher production costs, reduced product returns and restricted export demands all combine to lower milk returns for farmers.

With these challenges in mind, ADF is celebrating the progress made in trade reform to the long-term benefit of our industry. This progress boosts the
industry’s competitive position in the global market and contributes to building confidence to invest in a strong future for Australian dairy.

For more information on ADF’s Markets Trade and Value Chain priorities, click here.

A world-leading smart phone app developed by the ADHIS and Dairy Australia to help farmers
choose bulls to meet their breeding objectives is now available to download, free for dairy farmers and advisors.

The Good Bulls app has been designed in close consultation with dairy farmers and advisors and builds on the popular Good Bulls Guide. The app, which can
search from over 20,000 bulls, allows farmers and advisors to search, filter, short list and export bulls based on Australian Breeding Values and Australia’s
three indices.

ADHIS Extension Officer Sarah Saxton has led the team that helped create the Good Bulls app. She said the app will be an invaluable tool to access bull
information anywhere at any time, so farmers can take charge of their herd.

“The Good Bulls app really puts the power of herd improvement in the palm of your hand by giving users on-the-go access to over 20,000 bulls and the ability
to enquire about prices with their supplier at the click of a button” Ms Saxton said.

“It’s quick and easy. Select your index and shortlist bulls based on the traits you want to improve in your herd using the Good Bulls app”

The Good Bulls app answers a strong desire by farmers and advisors to be able to filter and sort bulls based on their preferences and to improve profit
in a fun and easy way.

Sarah says “We conducted over 20 hours of one on one interviews with a range of farmers and advisors in the design of the app so we are confident this
is going to be an essential tool for the industry”.

The Good Bulls app is available for both iPhone and Android phones.

For details on how to download the app visit www.adhis.com.au/goodbulls