Bundaberg Region dairy farmers will benefit from the decision by Woolworths to stop selling milk at $1 a litre from Tuesday.
The move will see the supermarket sell two and three litre varieties of Woolworths branded fresh milk for $2.20 and $3.30 respectively.
As the price change goes national, the company said it will deliver higher milk prices to more than 450 Australian dairy farmers supplying into Woolworths-branded fresh milk.
Woolworths said every cent of the increase will end up with Australian dairy farmers.
Chief executive Brad Banducci said the long-term sustainability of the dairy industry and regional communities is “incredibly important” for Australia.
“In our consultation with industry bodies, including the Australian Dairy Farmers Association, its state members and NSW Dairy Connect, we've heard the outlook will continue to be extremely tough for dairy farmers right across the country,” he said.
“This is affecting milk production and farm viability, which is devastating for farmers and the regional communities in which they live.
“It's clear something needs to change and we want to play a constructive role in making this happen.”
Farmers will receive higher price
The Queensland Dairyfarmers' Organisation welcomed the news.
In a media statement, QDO said customers could be confident all of the price increase would go back to farmers.
“Today is a day filled with joy for the Australia dairy industry as Woolworths ends the $1 per litre price war on milk,” the organisation said.
“This is a war that has crippled the dairy industry for over eight years.
“It will make a massive difference to the dairy farmers who supply Woolworths milk across Australia.”
Agriculture Minister Mark Furner agreed.
“The $1 milk wars as well as the ongoing drought has impacted Queensland’s dairy farmers, so it is pleasing that Woolworths has listened to consumer concerns,” Mr Furner said.
“Consumers should also consider the flow-on impacts their decisions have for Queensland jobs when they make their purchases at the supermarket – as buying Queensland produce supports Queensland jobs.”