The Dairy coalition has told dairy buyers, processors, retailers and the food service sector they must commit to British farmers to deliver better market returns in the future and secure a sustainable supply of milk.
The coalition, the NFU, NFU Cymru, NFU Scotland, FFA, TFA, WFU and the RABDF met in Stoneleigh today to discuss dairy market issues and its future strategy.
In the short term, the coalition has called for urgent and meaningful farm gate price rises for April 1, to ensure a realistic market price. Challenges of poor weather, infertility and feed shortages mean that farmers can only respond to demand for more milk if they are paid a proper price.
NFU dairy board chairman, Mansel Raymond said: Yesterdays Fonterra auction result saw significant price rises in key commodities such as cheese, butter and milk powders, with all products up 14.8 per cent on the previous month. This clearly demonstrates that globally, demand is strong and supplies are tight.
Yet were still hearing that crippling deals being done in the domestic cheese and liquid markets are putting milk prices under pressure. The average UK farm gate milk price for January was exactly 30ppl, this masks the range of prices being paid from less than 27ppl to over 33ppl, which is barely a penny ahead of this time last year. For UK dairy production to have a sustainable future, the only way these prices can possibly go is up.
Farmers For Action chairman, David Handley said: Im hugely frustrated by the apparent lack of traction in the UK market. We know our milk is valuable and in short supply, we know our consumer, the British public want to support British dairy, so why are we still failing to realise a sustainable price?
We need action by milk buyers now. FFA and the rest of the coalition have already called for complete transparency in country of origin labelling of dairy products. Imported cheddar, without clear labelling undercutting British prices is unacceptable.
NFUS milk committee chairman, Gary Mitchell said: There is plenty that milk buyers can do right now to help safeguard a sustainable production base. Starting with a sustainable price, we need complete sign up to the Voluntary Code. Strong market demand signals are being blocked by lousy contracts, poor labelling and an apparent lack of commitment to British by some important retail and food service businesses.