AUSTRALIAN Party leader Bob Katter proposed to re-regulate the dairy industry if he gained the balance of power in the Senate.

At a rally of about 100 farmers in Warrnambool Botanic Gardens today Mr Katter said farmers around the world were subsidised, and the only country that does not subsidise its farmers "is Australia''.

Mr Katter said his re-regulation legislation had been drafted and seconded by federal independent MP Andrew Wilkie.

"No one else cares enough or would dare to be associated with something as radical as this now.''

He said deregulation was "locked like a religion'' into the Australian Labor Party and that the Liberal National Party Coalition was worse, but he came to Warrnambool unashamedly to bring a political message.

"If we (the Australian Party) could get four or five senators added to their (the Democratic Labor Party) two then we should have control of the Senate,'' he said.

"We might not be able to do all the things that we would like to do for you, but we can make it bloody hell for those people that have destroyed agriculture in this country,'' he said.

Mr Katter said while there was a need for interim measures to help farmers now, many would not survive without re-regulation.

"We can only do that if you back the party that doesn't believe in free markets, but believes we should protect the jobs in manufacturing, in agriculture and in . . . our essential industries in this country.''

Rally organiser and Farmer Power executive member Chris Gleeson said regulation was one of the options being considered by the group.

"The first thing to do is to get an assistance package to help the farmers be viable in the short term and then we will worry about fixing the long term."

The Warrnambool rally follows a "dairy crisis'' meeting at Noorat last week of more than 600 farmers and service providers, as well as a protest at Coles at Warrnambool by Grassmere agricultural contractors John and Vashti Houston.

The couple said unsustainable farmgate prices was costing their business hundreds of thousands of dollars.

Farmers from northern Victoria will meet tomorrow night to discuss similar action or a public meeting for next Wednesday.