MPs urge protection for dairy farmers against milk price cuts
Number of British dairy farmers has fallen below 10,000 for the first time as low prices force many out of business
The number of British dairy farmers has fallen below 10,000 for the first time as low prices force many out of business. PHOTO: AFP
Dairy farmers are being forced out of business and need more protection in the face of sharp falls in milk prices, a group of MPs warned Tuesday.
A drop in prices last year prompted some farmers to abandon the industry entirely, bringing the total number of British dairy farmers below 10,000 for the first time, according to a report by the Environment, Food and Rural Affairs Committee.
A Russian ban on food imports and a decline in global demand has contributed to prices falling by 41% over the past six months -- to just 20 pence a litre.
"Frequent, sharp and unpredictable rises and falls in milk price are driving dairy farmers out of business every week," said committee chairman Anne McIntosh.
"The volatility of worldwide and domestic milk markets is making financial planning and investment impossible for small-scale producers unable to hedge against changes beyond their control."
The committee urged the government to extend the scope of groceries regulator to include dairy farmers.
The Groceries Code Adjudicator (GCA) was set up in 2010 to ensure that large retailers treat suppliers "lawfully and fairly", according to the department for business, innovation and skills.
However, the "vast majority" of dairy farmers fall outside the remit of the GCA, which can only investigate complaints involving direct suppliers to the 10 biggest supermarkets and retailers, the report said.
The committee also called for an EU-wide review of milk prices and pressed for clearer "country-of-origin" labelling so that consumers can identify British products.
The Department for Environment, Food and Rural Affairs (Defra) said it had given dairy farmers "greater clout in the marketplace" by offering the opportunity to join producer organisations.
"We have also brokered a dairy industry code of practice on contractual relationships to improve transparency and give farmers a fairer deal, which now covers 85% of UK dairy production," a Defra spokesperson said.
The Royal Association of British Dairy Farmers (RABDF) welcomed the committee's recommendations and urged prompt action.
"The GCA is currently ineffective in that it cannot do anything to help dairy farmers," said RABDF chairman Ian Macalpine.
"Virtually no liquid milk is sold direct, there is a continuing lack of transparency throughout the sector, and until we get better market intelligence, then we will continue to suffer milk price volatility."
A drop in prices last year prompted some farmers to abandon the industry entirely, bringing the total number of British dairy farmers below 10,000 for the first time, according to a report by the Environment, Food and Rural Affairs Committee.
A Russian ban on food imports and a decline in global demand has contributed to prices falling by 41% over the past six months -- to just 20 pence a litre.
"Frequent, sharp and unpredictable rises and falls in milk price are driving dairy farmers out of business every week," said committee chairman Anne McIntosh.
"The volatility of worldwide and domestic milk markets is making financial planning and investment impossible for small-scale producers unable to hedge against changes beyond their control."
The committee urged the government to extend the scope of groceries regulator to include dairy farmers.
The Groceries Code Adjudicator (GCA) was set up in 2010 to ensure that large retailers treat suppliers "lawfully and fairly", according to the department for business, innovation and skills.
However, the "vast majority" of dairy farmers fall outside the remit of the GCA, which can only investigate complaints involving direct suppliers to the 10 biggest supermarkets and retailers, the report said.
The committee also called for an EU-wide review of milk prices and pressed for clearer "country-of-origin" labelling so that consumers can identify British products.
The Department for Environment, Food and Rural Affairs (Defra) said it had given dairy farmers "greater clout in the marketplace" by offering the opportunity to join producer organisations.
"We have also brokered a dairy industry code of practice on contractual relationships to improve transparency and give farmers a fairer deal, which now covers 85% of UK dairy production," a Defra spokesperson said.
The Royal Association of British Dairy Farmers (RABDF) welcomed the committee's recommendations and urged prompt action.
"The GCA is currently ineffective in that it cannot do anything to help dairy farmers," said RABDF chairman Ian Macalpine.
"Virtually no liquid milk is sold direct, there is a continuing lack of transparency throughout the sector, and until we get better market intelligence, then we will continue to suffer milk price volatility."