End of $1 milk as Coles and Aldi announce change

Following the decision by Woolworths last month to cease sales of $1 per litre milk, Coles and Aldi have this week followed suit and increased the prices of their branded milk products across stores nationwide from the 20th of March.

Both outlets have upped the price on two- and three-litre branded milk to $2.20 and $3.30 respectively, in a move that has been praised by peak farming bodies.

“Coles has made the right decision to increase the price of its discount milk brand and they should be commended for their initiative in working to end this price-freezing practice,” said Australian Dairy Farmers chief executive David Inall.

“Farming families put tireless effort and resources into producing a quality product and there is no question that supermarket discounting has had an incredibly demoralising and negative financial impact on the Australian dairy industry over the last eight years.”

CEO of the National Farmers’ Federation Tony Mahar also welcomed the news as a relief to the many dairy farmers who have been struggling with market and climatic conditions over the past few years.

“Australian dairy farmers have been suffering under a range of financial pressures for too long," said Mahar. “There can be no doubt that the introduction of $1 milk in 2011 has had a demoralising and negative impact on the Australian dairy industry. It is time for the unrealistic price regime to end, for good. Farmers, and fair-minded shoppers, expect it.”

Both Coles and Aldi have also indicated a willingness to work with dairy processors to ensure the benefits of the price increase go directly to farmers, and also to work with the industry and government on a more long-term solution to the current price wars.

“Coles supports proposals to make Australia’s dairy industry more sustainable, and we are continuing to explore long-term solutions with government and industry stakeholders,” said Coles Group Chief Executive Officer Steven Cain. “However we know that many dairy farmers cannot wait for structural reform to be delivered so we are moving to provide relief right now.”