Supermarkets started exercising their muscle.
Milk was once a great earner for the Hunter.
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In the 1950s more than 1000 Hunter dairy farms supplied milk to local processing plants.
Importantly, their output - fresh and powdered milk, cream, butter, yoghurt, cheese - was sold to customers outside the region, meaning more money flowing into the Hunter economy, more jobs in rural areas, stronger communities.
Today, there are only about 100 dairy farms left. The Hunter Valley Co-op is long gone, it's OAK brand in the hands of Lactalis, a global dairy company based in France. Surprisingly, dairying remains the Hunter's most valuable rural industry after beef cattle. But it's a distant second, and in long term decline. Are the days of Hunter dairying numbered?
For guidance we can turn to geography scholars, Nathan Clay from Oxford in England, and Kayla Yirko from Virginia in the US. Like the Hunter, their home regions are suffering from dairy's decline. In the journal Compass, Clay and Yirko identify major trends in the world's dairy industry that have parallels in our valley.
Milk was a major driver of animal domestication around the world. Milk ended the need to slaughter animals for food. The herd became the asset, providing fresh milk daily for infants and children, and cheese and yoghurt for adults unaccustomed to lactose.
Milk later transformed magically into modern urban and industrial life. Every household signalled good health and prosperity through the presence of fresh milk in the kitchen. Out there in the countryside was the milking cow, the selfless, self-sacrificing mother from the natural world, willing and able to nurture city dwellers with a pure, clean liquid, looking and tasting the same every day. It was the perfect industrial product, but people saw it as the perfect gift from nature.
Dairying appeared late on the scene in Australia. In the 1880s and 1890s, as the coastal valleys in NSW were cleared of valuable timber, land holders turned to dairy cows as a pursuit capable of thriving in a wet humid environment. The lure was the rich UK butter market.
Growing numbers of city dwellers provided a local market. Country towns eagerly hosted dairy processing plants. The dairy cooperative movement gave small family farmers access to markets. Government regulation stepped on greedy monopolisers, and guaranteed fair prices.
By the mid-20th century, milk had become Australian's favourite farm commodity. Pasteurisation, long distance transport and refrigeration ensured drinking milk arrived fresh, cold and creamy-white every day at dawn on every porch. Surplus milk was processed into higher value products: cream, milk powder, cheese, yoghurt. There was room for large and small producers, local suppliers, giant exporters.
But in 1973 the thick Australian dairy processing chain started to disassemble. This was the year Britain joined the European Economic Community, now the European Union, and our butter exports melted. A succession of big hits to dairying followed. Margarine arrived. Governments walked away from price controls and industry assistance. Corporate producers gobbled up family farms. Supermarkets started exercising their muscle.
By 2020, production technologies have led to a massive rise in milk output. The cow produces more, every farm produces more, more milk comes from every tonne of feed, from every farm worker. High capital requirements drive out surviving small farmers.
But returns for big dairy producers are not guaranteed. Big supermarkets are happy to sell milk as a loss leader to attract customers. The big dairy corporations scramble for profitable sales. Once, milk carried the brand of a co-op. Now most milk sold in Australia carries a supermarket label.
But there is push back, especially from bold, innovative farmers and milk processors. A significant number of Hunter dairy farmers produce quality, organic, environmentally-safe milk. They market under their own label, in retail outlets that support their spirit, their ethics. So too there are artisanal cheese and yoghurt markers, reviving dairy milk processing chains, linking producers direct to consumers, pushing the rural dollar through more hands. And, once more, tourists are delighted at the Hunter's dairy products, just like they were at OAK dairy bars decades ago.
Of course, the long-term viability of the re-builders is in our hands.
Your weekly dairy spend matters a lot.
Phillip O'Neill is professor of economic geography at Western Sydney University
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