Paving the way for the factory dairy?

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Alastair Driver of the Farmers Guardian reported earlier this month that the Dairy Coalition – NFU, NFU Cymru, NFU Scotland, the Tenant Farmers Association, the Women’s Food and Farming Union and the Royal Association of British Dairy Farmers – has asked Farming Minister David Heath to ‘call in’ the 15% of milk buyers failing to implement the voluntary code on milk contracts.

NFU chief dairy adviser Robert Newbery said that the greatest resistance was coming from some of ‘big middle ground liquid processors’ who ‘don’t want to know’.

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Dairy UK director general Jim Begg said that the approach of the dairy companies had been ‘both responsible and constructive’.

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Three days ago Mr Driver showed figures collated by the Food Standards Agency (FSA) indicating that more than 30 farmers quit the industry in April alone in England and Wales. The number of dairy farmers in England and Wales has fallen by more than 40% from more than 18,000 in 2002.

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The Kingshay Dairy Manager costings show total purchased feed costs increased by 1.27 pence a litre over the past year, but milk price only went up 0.54ppl.

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DairyCo’s recent Farmer Intentions Survey showed that the current average farmgate milk price of around 30-31ppl is lagging behind the AMPE (Actual Milk Price Equivalent) market indicator, currently in excess of 38ppl.

NFU dairy board chairman Mansel Raymond said that if the leaving rate carries on for three months it will be serious: “The milk price has to go higher. The industry now needs that positive signal to move forward to increase production and invest.”

The Independent reports that an announcement on a timetable for plans for a farm in Foston, Derbyshire, stocking 25,000 pigs, is expected later this week. A decision on whether a 1000-cow mega-dairy near Welshpool can go ahead is also expected shortly.

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Joyce Watson, Member of the Welsh Assembly for Mid and West Wales, said: “With the full extent of the horsemeat scandal still coming to light, consumers want food they can trace and trust. Industrial-scale farms would be a big step in the wrong direction – bad for cows, bad for farmers, bad for consumers and bad for the environment.”

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Milk price rises, the voluntary code and a warning from the new minister

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Yesterday Ben Briggs reported that Robert Wiseman Dairies has put its standard milk price for about 300 non-aligned farmers up to 29ppl from October 15. It said that the other 750, who are aligned with major customers such as Tesco, Sainsbury’s and the Co-operative Group have their own milk pricing arrangements.

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Current milk price rankings:

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The Co-op – 30ppl (from October 1)

Arla – 29.5ppl (from October 1)

Wiseman – 29ppl (from October 15)

Dairy Crest – 26.6ppl

First Milk – 26.05ppl

NFU Scotland milk policy manager George Jamieson said: “The UK market has not functioned properly for over a decade but the expectation is that processors and retailers alike are looking to address that.”

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The profound pessimist editing this site places weight on warning voices

 

This is Cornwall reports that the “voluntary code” between the processor trade body Dairy UK and the farming unions could be too little, too late – and some industry insiders fear it may not work.

The union consensus: this should only be the start of price rises across the board.

NFU president Peter Kendall: “Most farmers are still losing money despite these increases and the price rises in the global market must work their way through as soon as possible.” 

The NFU site says that publication of the full code requires legal approval and former farmer and MP Neil Parish warns: “We shall have to look very closely at this voluntary code over time and, if it is not working, take action to ensure there is a mechanism that does. If that is the case I shall be asking the Government to bring in a mandatory code.”

Entrepreneur Somerset dairy farmer Derek Mead commented: “We are no nearer moving to a decent milk price than we were a month ago. Dairy farmers by the dozen are now rushing to sell up and get out of an occupation which has kept them poor for longer than they care to remember.”

Michael Day commented on the NFU site: “This still does not resolve the power of the Supermarket buyers who set the price of milk paid by the consumer. If they do not wish to charge more for milk in the supermarkets they will depress the price paid to the milk processors, which will have a knock on effect to farmer producers, and changing buyers will not resolve this market control”.

Dairy farmer Ian O’Reilly raises a seldom mentioned issue: “The problem here is again a dedicated pool (a small section of the industry) and this creates a “haves and have nots” industry”.

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Finally, This is Cornwall reports that speaking in the House of Commons for the first time as Farming Minister, David Heath said he would “seriously consider” legislating if a voluntary agreement between farmers and processors failed. Compulsory contracts guaranteeing farmers a fair deal for milk could be introduced to prevent future dairy blockades.

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