Mr JOHN COBB (10:42 AM) —The recent marketing gimmick by supermarket giant Coles has made something of a mockery of the Australian dairy industry, the supermarket’s claims at recent Senate inquiries and anything that has come before the ACCC. Jim Cooper, a spokesperson for Coles, was reported to have dismissed industry concerns in relation to reduced milk prices as ‘hysteria’. We have seen an example of arrogance in the extreme. This is a complete insult to people within the dairy industry trying to stay afloat.

After suffering one of the worst droughts in living memory, recent flooding, rising costs of inputs and price cuts, dairy farmers across the nation quite often are seriously questioning their future. Those with fresh milk contracts in particular will be forced to wear the cost of Coles’ latest marketing ploy. Over time they will have to renegotiate contracts at below the cost of production or leave the industry. This undoubtedly could be the straw that breaks the back of family dairy farms in Australia, particularly in north New South Wales, Queensland, WA and anywhere else they have fresh milk contracts.

In the last couple of weeks we have seen the home brands 40 per cent cheaper than the marketed brands we have all grown up with. You cannot blame people for buying these products. There are huge costs of living. The member for Bonner just talked about the cost of living. It is going up. The Rudd government and now the Gillard government, against everything they promised, are not dealing with it. They are certainly not dealing with it in this instance.

The figures put before the Senate inquiry last year just do not add up. The supermarkets have a 22 per cent mark-up. How can they then have a 30 per cent reduction and claim that they can absorb this? Obviously, they cannot. That is why those with fresh milk contracts know that at the end of the day they will wear this.

In the long run it will be the consumers who lose out. Consumers in Northern Australia may not have access to fresh milk. Perhaps they will have to go to processed UHT milk, in which case there will be an opportunity for supermarkets to bring it in from countries that do not have the same quality assurance that we do. Our farmers and consumers in the long run deserve better from the supermarkets, especially Coles. They claim to have an ethical sourcing policy; however, their arrogance lately would belie that. (Time expired)