News

Economic arguments at public meeting

By Dairy News

AMONG THE speakers at the public meeting at Darnum were owner representative Graham Osborn, dairy farmers Noel Campbell and Grant Williams, truck driver Trevor Bramstedt and livestock agents Michael Savage, Neil Darby and Darryl Adams.

Mr Adams described Warragul saleyards as Victoria’s premier dairy selling centre and best vealer market. Several dairy farmers and cattle traders have described it as key to setting a floor in the price of dairy cattle.

The day after the public meeting, the top price paid for a dairy cow sold through Warragul saleyards was $3300.

A lot of the arguments from the presenters at the public meeting were economic.

Mr Osborn argued the Victorian Livestock Exchange was rationalising efficiencies with the closure and indicated the success of VLE’s Koonwarra saleyards.

“Leongatha district dairy farmers are our biggest business,” he said.

He said VLE’s mission was to realise better competition and higher returns to farmers selling cattle, and that was unlikely at Warragul, in comparison to VLE’s Pakenham and Koonwarra saleyard facilities.

VLE also had plans to build a new saleyard facility in a few years time, to replace the Pakenham yards eventually, which are hemmed in by development.

Mr Osborn said the throughput at Warragul was largely dairy cattle from across Gippsland — 64 per cent — but 31 per cent of cows sold came from northern and western Victoria. Pakenham was a closer facility for those suppliers.

“Our core belief is providing a modern, soft-floor facility,” he said.

“We are closing Warragul to offer Pakenham prices for farmers. We want a bigger, more sustainable market; buyers want to choose from bigger consignments.

“Between Warragul, Pakenham and Koonwarra, Warragul is the weakest economic unit.”

Noel Campbell and Grant Williams are among a number of dairy farmers concerned about the lack of competition for dairy cattle and calves when Warragul saleyards closes this year. They asked for the Warragul saleyards to remain open for another couple of years, until the new saleyards is open.

While the Pakenham saleyards will remain open for the next couple of years, VLE intends to replace it with a facility closer to Warragul and outside potential urban zones.

Selling the Warragul saleyards, located centrally in the industrial zone, would part-fund the purchase of land and cost of building a new facility, Mr Osborn said.

Livestock transport company operator, Trevor Bramstedt, said the cost of transporting cows would double, carrying them to Pakenham saleyards. He quoted $60 per cow as the increased cost. He also pointed out he would have to provide holding facilities to make transport more efficient and effective for dairy farmers.

“We’re building an extension to our place to rationalise transportation of cows,” Mr Bramstedt said.

“They’ll arrive in small trucks and we’ll bring the cows together and transport them further on bigger trucks.

“Farmers will also have to build their own holding paddock to put their cow in while she waits to be picked up.”

According to NLIS guidelines, offloading the cattle temporarily will probably require an extra transfer of the PIC number into and out of Mr Bramstedt’s yards.

Elders livestock agent Darryl Adams said Warragul saleyards was a well used facility — with five agencies operating out of the facility weekly, along with invited agents — and the auction system was transparent and ensured a valued return to farmers; his view was endorsed by Mr Campbell and Mr Williams and other dairy farmers. Mr Adams said closing Warragul created a massive problem for the dairy industry.

“There are more than 36 dairy cow sales annually, using the selling ring every fortnight. Every month, on the first and third Friday, we sell herds, part-herds, lines and springers at Warragul,” he said.

There are 10 abattoirs within a 100 km distance of the Warragul saleyards.

“Warragul puts the floor in the dairy cow price,” Mr Adams said.

“All farmers need a commercial outlet and going to auction is where you get your premium price. The success of Warragul as a saleyards is because it is surrounded by a strong dairy region. Buyers are often farmers looking for milk inflow.”

Neil Darby is an owner of land at Longwarry and part of a group planning to build a new saleyards facility.

All farmers and livestock agents spoken to by Dairy News Australia are against the closure of Warragul saleyards, while there is no replacement facility in the region. The milking out facility is seen as an advantage at Warragul, although it was recently closed down.

Grant Williams, who milks 600 cows at two dairy farms at Athlone, said he used the chopper market, buys cows in milk at the dairy sale and appreciates the transparency of the calf sales, compared to selling direct to the abattoir.

Buln Buln dairy farmer Geoff Hewson relies on selling chopper cows through the Warragul saleyards.

Anthony Boulton, who milks 1800 cows across three dairy farms in the Sale district, regularly buys at Warragul saleyards. He attends the cow market on Friday, the chopper market on Thursday and the Monday calf market. About 90 per cent of the Friesian heifers he buys are exported for the heifer market.

“I put the floor in the price for dairy heifers,” he said.

“And 70 to 80 per cent of my dairy cows come out of Warragul. Some days at the Warragul saleyards, I’ll buy 90 per cent of the cattle for sale.

“VLE are destroying the calf market — the saleyards sets the benchmark for the market and dairy heifer calves sell for $400 there.

“Why should a farmer be forced to accept $50 over the scales [at the farm gate]?”

Mr Boulton said there were significant advantages for the wellbeing of farmers to attend the Warragul saleyards, beyond selling and buying cattle. It is something he has experienced himself.

“I love going to Warragul. Beyond the business side of it, it’s a gathering place for people to get together,” he said.

Wellington Livestock buyer Steven Boulton regularly brings dairy cows and heifers out of northern Victoria to sell at Warragul, where his clients know they will receive a premium price.

“At the most recent two sales, we sold 340 and 300 cows out of northern Victoria,” he said.

“Warragul is a competitive market for calves. All these people who raise calves will not be able to purchase them from dairy farmers. It’ll create a monopoly for those who buy over the scales and only pay $50 to $60 for a calf. On-farm sales lacks competition.”

Mr Boulton, who also owns a dairy farm, said 20 per cent of his purchases at Warragul saleyards would be dairy cows, heifers and calves for his own use.

Livestock agent and key driver behind the potential Longwarry saleyards facility, Neil Darby, was scathing about VLE’s decision to close Warragul saleyards.

“I don’t think the VLE have thought this through,” he told Dairy News Australia.

“A lot of dairy cows and calves come over here from south and west Gippsland, and VLE are not supporting the farmers of Baw Baw Shire. I think their motive is to undermine Longwarry.