Victorian Farmers Federation (VFF), Media Release, 28 May 2025
The United Dairyfarmers of Victoria (UDV) has expressed disappointment in Fonterra’s opening milk price of $8.60/kgMS for the 2025–26 season, saying it falls short of what is needed to sustain Victorian dairy farmers through one of the toughest periods in recent memory.
UDV President Bernie Free said the price completely misses the mark and will consequently leave some farmers questioning their future.
“This price simply doesn’t reflect the reality on the ground.”
“Farmers are facing record input costs, water shortages, failed pasture growth, and another year of intense financial pressure. An opening of $8.60 won’t cut it for many businesses trying to stay viable,” Mr Free said.
The UDV has been actively working with industry, government, and service providers to monitor the impact of the ongoing drought, particularly in the south-west, where a second failed autumn break and lack of rainfall have left paddocks bare and farms under severe stress.
“We’ve got farmers being forced to de-stock and taking on more debt just to keep operations running. It’s putting a real strain on their mental health.”
“Processors need to recognise that an aggressive cost-of-production environment demands a stronger pricing commitment,” Mr Free added.
While acknowledging Fonterra’s efforts to provide early price certainty, the UDV is calling on all processors to review their opening prices with urgency and ensure that they reflect both global market conditions and local seasonal adversity.
“This is not a normal year. The cost base has shifted dramatically and $8.60 does not provide the margin needed to justify continued investment or ensure on-farm resilience,” Mr Free said.
The UDV will continue to advocate for pricing that reflects the true cost of production and supports farmer confidence through volatile seasons.
