Coles to source milk directly from two dairy farmer co-operatives COLES will directly source $2.6 billion of milk over 10 years from two dairy farmer co-operatives, as the giant retailer moves to contain the fallout from its controversial, $1-a-litre discounting strategy introduced in 2011. As a result of its 10-year, $2bn deal, Devondale (Murray Goulburn Co-operative) will make the biggest milk processing investment since the industry deregulated in 2000 -- two facilities in Melbourne and Sydney worth $120 million, to supply Coles' private label brands in Victoria and NSW.