Dairy industry- Adjournment

Mr O'SULLIVAN— My adjournment matter tonight is for the Minister for Energy, Environment and Climate Change, and the action I am seeking from the minister is for her to come and meet with me and representatives from the United Dairy Farmers of Victoria so the minister can justify the price hikes that processors and dairy farmers are receiving now and for the minister to hear firsthand the concerns of the industry and the impact this is having on their particular businesses.

As we know, energy prices have been not just sneaking up but rising very quickly in the last few years, and that is really starting to have an enormous impact on not only dairy farmers but a whole range of food producers who have a vital role in growing and producing the food that everyone in this chamber, in this city, in this state and in this country eats. We want to ensure that we remain a country that is able to produce clean food that is of a high standard to feed our own people. As well as that, we also want to be in a position where we can export the balance of the food that we grow to other parts of the world so they can have the same access to the clean, green food that we produce here — which I think is probably of a higher standard than anywhere else in the world. But there are some significant issues happening that are starting to put a real dampener on that occurring.

Dairy processors in this state are being hit by additional costs of about $170 million per annum in terms of their electricity prices. What that is doing is putting extra costs back on the dairy farmers in terms of their receiving a lower price for their milk. They are paying about 1 cent a litre extra, which does not sound like much, but that is starting to equate to about a $15 000 increase per year per dairy farmer. Also, the dairy farmers themselves are experiencing higher power bills to run their own dairy operations on their farms, and we are seeing something like an $18 000 to $19 000 on average increase in electricity bills for dairy farmers over the last three years.

So dairy farmers are actually paying twice: they are getting less money for the milk that they produce because they have to pay the electricity costs for the processors, and they are paying higher power bills themselves to actually undertake the milking of cows on their farms. So farmers are really starting to feel the impact. If this continues, it will not be viable to produce milk in this state and we will have to import it from overseas, because the cost of doing business, either producing or processing, is going to be out of reach for ordinary dairy farmers in this state. The minister needs to meet with the industry to hear their concerns firsthand.

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