Lion Dairy and Drinks (LDD) has posted a sales increase of 19 percent, proving that the company’s three major fresh milk brands had benefited from the 2016 dairy crisis.
In 2016 a campaign against cheap supermarket milk encouraged customers to purchase other brands that paid higher farm gate prices to dairy farmers.
As Australia’s fourth-biggest dairy processor, LDD recently launched a campaign encouraging Australian’s to drink more milk but if this sales increase is anything to go, it appears their job might well be done.
Currently, LDD have 400 farmers supplying the business with products nationally.
Lion Dairy and Drinks external relations director Elise Gare said LDD was committed to competitive pricing, partnership, and purpose.
“…Lion did not impose retrospective cuts in response to market conditions last year and does not support them as a matter of principle,” she said.
“They undermine trust and damage farmers’ ability to plan for and invest in their businesses.”
LDD has also increased the amount of milk processed annually from 750 million litres to nearly one billion litres, enabling them to take on more contracted dairy farmers, according to The Australian.
Speaking on the “milk crisis”, LDD managing director Peter West said it wasn’t an issue for LDD farmers. Speaking on the milk crisis that occurred when
“We think what they did with retrospective pricing and the clawback was absolutely atrocious,” he said in reference to when Murray Goulburn dropped its farmgate prices, and Fonterra changed its prices throughout the year.
The average milk price paid to LDD farmers over the course of this year will be up to $5.60 per kilogram of milk solids, compared with Murray Goulburn’s $4.85 per kilogram.