Quota exchange adhering to divisive history
There was the EU court Mulder case, the outcome of which still baffles many logical thinking farmers, and the Development Farmers action, which went to the Supreme Court before the affected farmers received what appeared to have always been their justifiable entitlement.
The Milk Quota Review Group — comprising of representatives from the various sectors including dairy farmers to advise the Minister of the day on quota regulations, had the most difficult task, but over time achieved a respected balance within constraints.
There are those who made a lot of money out of lease/sale of milk quota — which they received for free — and the buyers who were forced to pay unsustainable prices for milk quota to remain in business at a viable level. As the milk quota regime moves towards what appears to be the final years of its existence — predicted to have less than a decade to run — its final phase through the new Milk Quota Exchange is already shaping into as divisive a period as any in its history. There has always been difficulty in striking a balance between what was seen as greed and need. There were those, frequently referred to as the backbone of the dairy industry, very well established, large scale, very efficient milk producers, many of whom were willing to pay the top dollar for milk quota, which allowed them to increase production.
Then there was the social need to serve the small and medium scale producers who needed additional quota to sustain a living from milk production, but their size of operation restricted what they could afford to pay for quota through purchase or lease. It may be early days yet in the life of the Milk Quota Exchange, but the satisfaction rating indicators from milk producers are not looking good.
Ironically, so much of the troubles stem from a bad decision that was made more than two decades ago when milk quota was allowed to become an individual farmer asset rather than the EU intended State held and managed “licence to produce”. There is a lesson in the history of the milk quota on the high price which is ultimately paid for bad decisions.
