Dairy payouts stalled

South West farmers selling milk to cooperative Challenge Dairy are still waiting to be paid for their September contract, as meetings with producers continued yesterday.

The payment delay has added to farmers’ woes this year after poor grain yields and a lack of winter rainfall added to burgeoning operating expenses.

Regional Development Minister Brendon Grylls said the Government would assist farmers, but "people need to be responsible for their own business decisions".

"Agriculture is subject to the vagaries of world markets and supermarkets and others and it’s a very challenging environment," Mr Grylls said.

"All primary production relies on the vagaries of the market.

"Wheat farmers have had a tough year, dairy farmers involved with Challenge Dairy are doing it tough, and it’s a difficult scenario down south with Gunns timber and their restructuring.

"We would like these things not to occur; a good Government finds a way to support the community and manage through the difficult times."

WA Farmers Federation dairy section president Peter Evans said yesterday the farmers were yet to be paid, but he was hopeful a solution would be found soon.

"I think they (Challenge) have been struggling with things for 12 months now, I don’t know why but they haven’t seemed to have recovered," he said.

"There’s always some issues somewhere, it’s life, it’s business, it’s competition."

WA farmers regained control of Challenge Dairy in April after the cooperative moved to majority ownership of Challenge Australian Dairy Pty Ltd.

The change in ownership follows a difficult period for Challenge Dairy, which increased sales in the year to December 2009, but incurred an operating loss.

The poor performance has been attributed to depressed selling conditions, exacerbated by the protracted economic downturn that struck in late 2008.