In the run up to this year’s Dairy Show, South West farmers’ leaders have renewed their call for dairy processors to pass on increased market returns to farmers as soon as possible.
Processors Arla and First Milk have both recently announced price increases but, whilst this is a welcome step in the right direction, there is still a long way to go before dairy farmers are being paid a sustainable price, or one that reflects current market conditions. This, together with the increased costs involved in dealing with bovine TB, is putting considerable pressure on the industry.
August’s AMPE (Actual Milk Price Equivalent) was 26ppl and the MCVE (Milk for Cheese equivalent) was 28ppl (pence per litre). But July’s Defra average milk price, which included aligned prices, was only 20.57ppl.
Arla and First Milk’s increases will take them to an average of 21.65ppl and 20.5ppl respectively – estimates of the cost of producing a litre of milk vary between 28 and 31ppl.
At the same time, milk production continues to fall. Across Great Britain, production is currently some two million litres a day below the three year average. UK deliveries are down more than seven per cent on this time last year with many processors experiencing shortages.
Andrew Branton, chairman of the NFU’s South West regional dairy board said: “Surely it is in processors’ interests to do everything possible to stop the loss in supply or risk shortages increasing. Farmers have been patient over the last few months, but that patience is starting to wear very thin. The signs in the market are better than they have been for some time and it is imperative this is reflected in the prices we are paid.”“The recent increases, whilst encouraging, still take us nowhere near the kind of prices we need to sustain the industry. Farmers will be able to admire lots of shiny kit at the Dairy Show – whether anyone will have the confidence to invest is another matter entirely.”
“The winter period, with all its increased costs, is fast-approaching and if we are not to see more farmers going out of business then prices must go up immediately.”
The NFU stand will be in its usual place alongside the main ring at the Dairy Show, which is being held on 5 October at the Royal Bath & West Showground in Shepton Mallet.
Guests will include NFU Vice President Guy Smith, national dairy board chairman Michael Oakes, regional dairy board chairman Andrew Branton and chief diary adviser Sian Davies.