ACCC authorizes 'Fair Go Dairy' licensing scheme

By Jim Cornall contact

- Last updated on GMT

The Fair Go Dairy scheme is expected to be launched in the coming months. Pic: Getty Images/JohnCarnemolla
The Fair Go Dairy scheme is expected to be launched in the coming months. Pic: Getty Images/JohnCarnemolla

Related tags: Accc, Dairy, Australia

The ACCC has authorized the Queensland Dairyfarmers’ Organisation Limited (QDO) to give effect to its proposed ‘Fair Go Dairy’ licensing scheme for five years.

 Under the scheme, QDO will grant processors a license to use the ‘Fair Go Dairy’ logo on qualifying dairy products. These products must contain at least 80% unprocessed milk produced by Queensland dairy cows and purchased from a Queensland dairy farmer for more than or at a price QDO considers as ‘fair.’

“We consider the ‘Fair Go Dairy’ scheme will likely result in a small degree of public benefit,”​ ACCC deputy chair Mick Keogh said.

“The scheme is likely to give consumers more information about the price paid to the farmers supplying the milk for participating products. It may also be a useful tool for dairy processors to signal to consumers what they are paying Queensland farmers.”

Some smaller processors in Queensland are likely to qualify for the scheme and have expressed an interest in participating. So far, no major milk processors in Queensland have indicated they will participate in the scheme.

In 2021/22 QDO has calculated a minimum price of 73.8 cents per liter processors have to pay farmers in order to participate in the scheme.  

QDO is an advocacy organization representing the interests of dairy farmers across Queensland. QDO is a not-for-profit organization with voluntary dairy farmer membership.

Processors that comply with the ‘Fair Go Dairy’ scheme will be able to affix the a registered trade mark to dairy products including milk, dairy cream, dairy desserts and cheese variants.

The ‘Fair Go Dairy’ scheme is intended to be voluntary, and only brands choosing to display the trade mark, denoting they are paying farmers a ‘sustainable and fair farmgate price,’ must comply with the scheme.

ACCC fair go dairy

The scheme is expected to be launched in the coming months.

The ‘sustainable and fair farmgate price’ will be equal to the two-year rolling average cost of production (most recently available) adjusted for inflation. The cost of production figure will be taken from the Queensland Dairy Accounting Scheme’s annual report.

The ACCC granted QDO interim authorization in December 2020 to allow it to commence negotiations with milk processors and undertake marketing and planning for the scheme. However, interim authorization did not permit any resulting agreements to be signed or come into effect until the ACCC’s final determination.

QDO sought authorization from the ACCC because the scheme may otherwise involve anti-competitive behaviors that could breach the Competition and Consumer Act 2010, since participants in the scheme are likely to be competitors.

ACCC authorization provides statutory protection from court action for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act 2010.

Broadly, the ACCC may grant an authorization when it is satisfied the public benefit from the conduct outweighs any public detriment.

Related topics: Regulation & Safety, Pricing Pressures

Related news

Follow us

Products

View more

Webinars