May 18, 2021

Australia's ACCC urges dairy farmers to be aware of rights under dairy code compliance

The Australian Competition and Consumer Commission (ACCC) has urged dairy farmers and processors to be aware of their rights and obligations under the Dairy Code of Conduct ahead of the 1 June deadline for publishing next financial year's milk supply agreements.

The code requires most dairy processors to publish standard form milk supply agreements to cover all the circumstances in which they intend to purchase milk in the coming financial year on their websites by 2pm on June 1, 2021.

This allows farmers to compare processors' minimum prices and contract terms.

Dairy processors must also publish by June 1, 2021 a report that details information about disputes connected to their milk supply agreements that were subject to mediation or arbitration in the 12 months to April 30, 2021. Importantly, processors whose milk supply agreements were not subject to disputes must still meet this reporting obligation.

Mick Keogh, ACCC deputy chair, said the ACCC will be checking the compliance of milk supply agreements and dispute reports immediately after the June 1 publishing deadline and conducting risk-based audits at any time throughout the year, which includes randomly selected traders and those with a history of complaints made against them.

Keogh said the ACCC is emphasising the requirement for processors to publish their dispute reports on time as the reports allow farmers to see if processors have been involved in any recent disputes about their milk supply agreements, which can help farmers decide who to supply their milk to.

The dairy code came into effect in January 2020 and the ACCC has so far announced two enforcement outcomes relating to failures to publish by the June 1, 2020 deadline. Investigations into other processors are ongoing.

Last year, the ACCC observed that most processors met their obligations under the code; however, it also observed several areas where compliance needed to be improved. These areas included processors' compliance with the publishing obligations, and the code's single document, termination, and supply period requirements.

- ACCC