Consumer advocacy group Choice has accused milk processors of pocketing the extra profits from the surge in support for branded milk.
“The $1 a litre milk boycott, which is seeing consumers swapping cheaper supermarket private label fresh milk for premium brand products such as Dairy Farmers, will see consumers spending an additional $113.7 million with no guarantee this will be passed on to farmers,” Choice's head of media Tom Godfrey said.
“If the current private label milk boycott continues, consumers look set to spend tens-of-millions more this year in the belief that purchasing branded milk will result in farmers receiving a bigger pay day.”
Choice said Murray Goulburn, Fonterra, Lion and Parmalat had offered no guarantee they would pass on the windfall to farmers.
Choice has written to milk processors asking them to confirm what additional profits are being made from the consumer boycott, and whether they planned to pass on funds.
Since the boycott started in May this year, sales of $1 per litre private label milk have dropped dramatically, falling from 63.3 per cent of sales by volume to just 50 per cent.
“The sad fact is, since the private label boycott began, these major processers have cut the farmgate milk price paid to farmers even though they are being paid more by consumers,” Godfrey said.
