Building enduring relationships with our dairy farmers
At Lion, we are committed to growing in partnership with the almost 390 dairy farms around Australia who supply us with milk.
We seek long-term relationships with the dairy farmers who supply us directly or through the Dairy Farmers Milk Cooperative (DFMC).
We believe sustainable dairy farmers underpin a sustainable dairy business, high quality products, happy farmers and healthy cows. Our approach to milk procurement is therefore based on offering farmers ‘three P’s’: competitive pricing and contract terms, partnerships for the long term, and a clear purpose and strategy built around growing profitable demand for dairy and ensuring sustainable returns through the supply chain.
What are the 3Ps?
We offer our farmers competitive contracts that offer secure pricing and as much choice as possible. We recognise local dynamics and, in the trade-exposed and more volatile southern region of Victoria, South Australia and Tasmania, we offer our farmers a broad range of fixed and variable pricing options for contracts of varying lengths (1, 3 or 5 years). We continue to receive positive feedback from our farmers in the southern regions.
We do not believe in retrospective changes in milk price as we think they undermine trust and damage farmers’ ability to plan for and invest in their businesses. That is why we did not impose retrospective cuts in response to the 2016 market conditions and do not support them as a matter of principle.
We offer a broad range of benefits to our dairy farmers, including grants to improve farm efficiency and sustainability, best practice advice and support. Our Farm Services team promotes best practice dairying techniques and works individually with our dairy farmers to help them plan and improve their businesses. In FY16, we visited our dairy farmers 1,500 times, averaging four visits per farm.
Our dairy farmer sustainability program called Lion Dairy Pride Program was launched in late 2016. Eighteen months in the making, this program offers our farmers a unique way to measure, evaluate and improve key areas of sustainability on their farm. We also provide our dairy farmers and their families 24-hour access to a free independent counselling service through the Lion Dairy Pride Farmer Support Program.
In addition, in partnership with Landcare Australia we give our dairy farmers the opportunity to apply for Lion Dairy Pride Landcare Grants to help improve on-farm environmental efficiency and profitability. Projects can focus on reducing energy consumption, enhancing nutrient management or increasing biodiversity. The grants provide our farmers with the tools and resources to meet ongoing environmental challenges in the dairy industry. To date, 52 farmers have received grants of up to $10,000 each under the program.
Also part of Dairy Pride is our By-Products Program, an initiative that allows our dairy farmers to access grain leftover from the brewing process for use as stock feed.
We offer our dairy farmers in South East Queensland, South Australia, Victoria, New South Wales and Western Australia access to the brewers’ grain at competitive rates. The grain is sourced from local Lion breweries and sold to our farmers as feed.
Brewers’ grain offers high quality nutrition for dairy cows and benefits for farmers. As part of a balanced diet, brewers’ grain can help to increase milk output, enhance fat and protein composition, and improve farm productivity.
In addition to access to brewers grain, dairy farmers who supply us in NSW also have access to the citrus pulp which is a by-product from our juice manufacturing site at Leeton in NSW.
“Lion Dairy Pride is a well-researched program, providing our dairy farmers with essential information that is trusted and easy to access. We are very proud of this initiative; as a partnership it allows us to deliver delicious dairy goodness to every Australian, every day.” Lion Dairy & Drinks Managing Director, Peter West
We have a clear and credible strategy that is focused on the long term and committed to driving value and profitability back into dairy. Farmers who supply Lion share our pride in making some of the most iconic dairy brands in the country. We are also united in our passion for promoting the nutritional benefits of dairy and making sure more Australians enjoy great tasting dairy goodness every day.