On Monday, the supermarket giant announced it would be increasing the cost of its milk from $1 per litre by 10 per cent.

In a move designed to benefit farmers, the two-litre bottles will now be $2.20, three litres will be $3.30 and the litre bottles will continue to be $1.20.

The price increase will go directly to the farmers.

Woolies first increased the prices back in September 2018 as part of drought relief efforts.

This has already raised $5.8 million for farmers. Now the price increase will remain to further assist the farmers.

Coles has been doing something for drought relief with a 10 per cent levy on the three-litre bottles. This was announced as a temporary fund-raising effort.

The $1-a-litre milk started back in 2011.

At the time, the price cut was met with criticism by the dairy industry. 

However, an Australian Competition and Consumer Commission inquiry in 2017 found the cheap milk could be the blame for low farm-gate prices.

The same inquiry did find a power imbalance between the farmers and the large milk processors.

This levy model from Woolworths is a great way to ensure that 10 per cent will be going directly to the farmers and not the back pockets of the popular supermarket.

It also improves the competition between other milk brands, which was one of the criticisms of the move eight years ago.

The dairy industry is having a rough time with droughts having a devastating impact, which includes financial, physical, mental and emotional stress.

This move by Woolies is a step in the right direction to support a pivotal industry in Australia.

The move will also put pressure on the other supermarket giant, Coles, to come to the party and make its levy permanent moving forward.