Dairy supplier Charles Dillon has seen the impact on farmers of their financial struggles.
Charles Dillon has a close up view of how Victorian farmers are hurting.
Mr Dillon regularly travels the roads between Mount Gambier and Apollo Bay, visiting the 450 customers who use his Naringal-based dairy supply business.
“I see a lot of farmers and I can see they are hurting,” Mr Dillon said.
He told a dairy crisis meeting this week the tight finances of south-west dairy farmers were illustrated by a blow-out in the number of his customers unable to pay their bills in less than 30 days.
Last year 98 per cent of his customers were on accounts where they paid within 30 days.
This year up to 70 per cent of his customers had bills that were overdue by 90 days or more.
“It is scary. They simply do not have the money to pay,” Mr Dillon said.
He said he had never encountered such difficulty in getting his invoices paid in more than 15 years in the business.
The large amount of money owed to him had forced him to borrow money to keep his business open, he said.
“If this continues for another 12 months, I will not be in business.”
Mr Dillon said some of his customers who were experiencing financial difficulty were second and third-generation farmers who had a low level of debt on the farm property: “They own the farm.”
However, increases in farm operating costs, such as higher feed bills, had created a massive financial strain.
He said this stress was also putting marriages between farmers and their wives at risk.
Mr Dillon fears some farmers are being placed under heavy mental stress they cannot cope with.
“In northern Victoria, that led to suicides,” he said.
He said part of the solution was a rise in the farm gate milk price and an end to the supermarket milk price war.
“We need someone like the Builders Labourers Federation (BLF) to fight aggressively. We need to give the United Dairyfarmers of Victoria the flick.”
He suggested dairy farmers and industry service businesses throughout Australia should contribute to a fighting fund to employ people to help farmers become more effective in improving their returns.
Meanwhile, Coles supermarkets has hit back at claims that its heavy discounting of milk prices is reducing farm gate milk prices and devaluing the product in the minds of consumers.
Speaking yesterday on Melbourne radio station 3AW, Coles spokesman Jim Cooper said the supermarket was funding the milk price cut and there was no impact on the price paid to farmers.
“We are taking a haircut on this,” Mr Cooper said.
He said export demand determined the farm gate milk price in Victoria, not the retail price of milk in supermarkets.
Coles’ response comes after south-west dairy farmers were this week urged to mount a tractor blockade of supermarket giants Coles and Woolworths in a bid to stop the milk price war.
Speaking at the dairy crisis meeting in Noorat in front of about 600 people, Mr Hamblin also called for south-west dairy farmers not to supply milk to distributors who supplied the supermarket “duopoly”.
“Let us drive our old tractors into town and park in the supermarkets,” he said.
If you or someone you know is experiencing an emotional crisis, call Lifeline on 13 11 14.