The Australian dairy industry plans to implement blockchain-based solutions for its weakening milk producers
Australian dairy farmers have faced droughts, bushfires, and overseas competition in recent years – factors that have caused the sector’s trade share to decrease from 16% to 6% in the past 30 years. Farmers are now facing a bleak reality as their income has dropped dramatically as efforts have increased. They are forced to live on income that is barely enough to survive and maintain the business. In the July issue of their magazine, the Australian Dairy Farmers (ADA) announced the implementation of blockchain solutions to address the existing power imbalance between farmers and processors.
Not a new problem
The current difficulties facing dairy farmers in Australia have been going on for a long time. Several problem-solving initiatives have already been launched – but with little success. According to the Australian Competition and Consumer Commission (ACCC), there has been a power imbalance in the dairy industry since 2018 and the resulting uncertain market prices, farmgate prices and imbalances in negotiations. The use of milk trading platforms, industry-standard contracts and binding rules of conduct were not enough to solve the existing problem. The German government has now mandated ADA to use a blockchain to create more transparency in the trading and marketing of milk.