Australian Dairy Farmers go broke while Multinational Milk distributors make $2.B plus of profits

Tasmanian Independent JLN Senator Jacqui Lambie has renewed her call for all political parties to commit to a 50c per / litre Milk levy - after independent Parliamentary research* shows that profit over the last 3 years for our big 4 Milk distributors was $2B plus, while 40% of Tasmanian Dairy Farmers were at risk of going broke.

“Everyone in the Australian milk business is making lots money – except our Australian farmers.

Independent research shows that over 3 years - total profits for Australia’s Multinational Milk distributors is greater than $2B.

How can such massive profits be made by the Multinationals, while our Australian Dairy Farmers go broke? Dairy farmers need a fair price… not more government debt.

The only solution to this Milk crisis is a 50c per / litre levy, paid directly to our Dairy farmers,” said Senator Lambie in a YouTube address.

“Figures from the Parliamentary Library for the last 3 years show that some of the Multinational Milk distributors’ total profit was:

  • $1.21B - Fonterra
  • $82.5M - Murray Goulburn
  • $656m - Lion
  • $129M - Parmalat
And I haven’t even considered the profits of the two big national retailers of milk!” said Senator Lambie.

“Malcolm Turnbull’s and Barnaby Joyce’s recently announced $555 M package of concessional loans and welfare is not a life-line for the Australian Dairy industry – it’s just a sly, cheap headline for the government during an election campaign.” said Senator Lambie.


* parl






18 May 2016

Dairy brief

You asked for information on:

  1. Please give overall summary of Fonterra - ownership, profits, customers, donations to political parties
  2. Identify all of Australia's milk manufacturers and buyers
  3. Describe their corporate structure
  4. Who makes up their management
  5. Identify local and overseas ownership
  6. Annual Profits for the last 10 years
  7. Number of people they employ
  8. List donations to any political parties for the last 2 elections
  9. Compare how much farmers are being paid on a per litre and per weight of milk fat basis to OECD countries.


  1. General information on Fonterra is contained in the table provide in response to question 2. Other information on Fonterra in contained below

Fonterra appears to export a large majority of its products to a large variety of customers around the world.  Earnings before interest and tax in the 2014–15 financial year by region were:

  • Oceania $51 m
  • Asia $202 m
  • Greater China $45 m
  • Latin America $110 m.

Fonterra was implicated in the 2008 Chinese melamine scandal (as it was a part owner of the Sanlu Group, who’s products, contained the melamine) and its CEO, Theo Spierings, recently said ‘what we are doing is (sic) drive every sent of money which we can out of Australia back to New Zealand shareholders’.

  1. The table below details information on the major dairy processes in Australia, responding to 2. a to e.
Corporate Structure Senior Management Annual Profit Shareholders No. Employees
Bulla foods Private Company based in Derrimut, Victoria. N/A N/A Bulla has been owned by the same three Victorian families since the company was founded in Melbourne in 1910. N/A
Fonterra Fonterra Australia Pty Ltd is a wholly owned subsidiary of Fonterra Co-operative Group Limited, a Limited Public Company headquartered in New Zealand. Non-Executive Chairman -    John Wilson                       CEO  -           Theo Spierings 2013 - NZD647.9 million

2014 - NZD141.7 million

2015 - NZD420.5 million

Owned by a co-operative of 10,500 dairy farmers across New Zealand. 16,000 globally of which 1,800 are in Australia
Lion Lion Pty Ltd is a foreign owned proprietary company. Non-Executive Chairman -                  Roderick Eddington       CEO -               Stuart Irvine 2013 –

($229.1 million)

2014 –

$188.5 million

2015 –

$238.7 million

Wholly owned by the Japanese company Kirin Holdings. 7000+ across all of its brands (dairy and non-dairy) in Australia and New Zealand
Murray Goulburn        Co-operative Murry Goulburn is a co-operative with trust units listed on the Australian Securities Exchange Chairman -                           Philip Tracy 2013 –

$29.4 million

2014 –

$27.9 million

2015 –

$25.2 million

2600 farmers are unit holders of the company. 2,400 employees
Parmalat Australia Parmalat Australia is a subsidiary of Parmalat SpA of Italy. CEO -            Craig Garvin 2013 –

$38.8 million

2014 –

$56.4 million

2015 –

$34.0 million

Parmalat Australia’s immediate parent company is Parmalat Belgium SA which is owned by Parmalat SpA which is subsequently owned by the Lactalis Group of France. Parmalat has 36,000 employees in 18 countries, 2,500 of which are in Australia
Warrnambool Cheese and Butter Factory Warrnambool Cheese and Butter Factory is a public company listed on the Australian Securities Exchange Non-Executive Chairman -                     Lino Saputo Jnr           President and COO -                   Kai Bockman                             CEO -            David Lord 2013 –

$7.5 million

2014 –

$21.3 million

2015 –

$34.3 million

Majority shareholder (88%) is Canadian company Saputo Inc.                                  Lion Dairy and Drinks Pty Ltd also have a large shareholding (10%). 510   employees
Bega Cheese Bega is a public company listed on the Australian Securities Exchange Chairman -              Barry Irvi


CEO -           Aidan Coleman

2013 –

$25.5 million 2014 –

$66.1 million  2015 –

$12.4 million

The largest shareholder is New Zealand Milk (Australasia) Pty Ltd  (9% of issued shares) 1700 employees
Only Lion has lodged a donor return in the last 10 years.

The below table outlines its donation figures.

Year Coaliton ALP Grand Total
2008-09 $12,732 $39,977 $52,709
2009-10 $12,800 $52,604 $65,404
2010-11 $1,149 $12,447 $13,596
2011-12 $47,000 $92,500 $139,500
2012-13 $94,637 $6,570 $101,207
2013-14 $66,900 $46,262 $113,162
2014-15 $63,600 $45,000 $108,600
Grand Total $298,818 $295,360 $594,178

Note: The information on political donations is drawn from the donation disclosures lodged by political donors with the Australian Electoral Commission (AEC) and available from the AEC’s Annual Returns database. The information was extracted from the AEC’s database in February 2016, which includes returns for the 2014/15 financial year, and may omit amendments to returns lodged since then. Please note that donations will only be listed here if the donor has submitted a donation return to the AEC for that particular financial year and only donations above the disclosure threshold (CPI indexed from $10,000 in 2005) are required to be listed.

  1. World farm gate milk price
In Australia, farmgate milk prices are reported in dollars per kg of milk solid. For example, Fonterra and Murray Goulburn reduced their rate from $5.60 per kg of milk solids to between $4.75 and $5.00 per kg of milk solids. Other countries report farmgate milk prices differently, such as milk per litre and per 100 litres. The below table shows milk prices in euros per 100 litres.

Farm gate dairy prices, euros per 100L, various countries

€ per 100L Jan-16 Feb-16 Mar-16 Apr-16
Argentia 18.58 17.18 17.4 -
Belarus 20.32 18.38 19.25 -
Brazil 24.11 24.95 27.8 29.99
China 49.86 49 49.02 47.24
Japan 77.46 18.76 80.23 -
New Zealand 21.22 19.99 20.29 -
Russia 26.12 25.62 28.12 -
US 32.68 31.2 30.39 -
Uruguay 22.11 21.48 22.11 -
UK     29.65*  
By comparison, Australian farm gate prices (for $5.00 and $4.75 per kg of milk solids) in euros per 100L are approximately €22.75 and €24.05, based on an exchange rate of $1 Aud = 0.65 euros.

The price of $5.60 per kg of milk solid equates to 26.25 euros per 100 litres.

*The UK figures are based on a milk price of 24.17 pence per litre and an exchange rate of 1 pound to 1.28 euros.

References (for the table):

IBIS World Company Reports –
  • Fonterra Co-operative Group Limited
  • Lion Pty Ltd
  • Murray Goulburn Co-operative Co Limited
  • Parmalat Australia Pty Ltd
  • Warrnambool Cheese and Butter Factory Company Holdings Limited
Annual Reports: Company Websites:


.   Fonterra, Annual Review 2015, p. 38, accessed 18 May 2016.

.   B Bouckley, ‘Fonterra never checked Sanlu’s dairy products prior to a deadly China melamine crisis, study warns’, Dairy, 20 June 2014, accessed 18 May 2016.

.   J Durie, ‘Condensed pain for Fonterra’s farmers’, The Australian, 18 May 2016, accessed 18 May 2016.

.   AHDB Dairy, ‘UK, GB and NI Farmgate prices’, AHDB Dairy website, 5 May 2016, accessed 18 May 2016.