Troubled milk cooperative Dairy Farmers of Britain (DFOB) has called in the receivers.

The formal announcement came following a meeting between the company’s directors and bank representatives on Tuesday (2 June).

Talk about the demise of DFoB with other producers on our forums


Read Phil Clarke’s Business Blog on how the banks should treat DFoB

PricewaterhouseCoopers LLP were formally appointed receivers on Wednesday (3 June).

Stephen Oldfield, joint receiver and partner at PricewaterhouseCoopers LLP, said: “Dairy Farmers of Britain (DFOB) has experienced very challenging trading conditions in its liquids business.

“Efforts to sell the liquids businesses continue, but the DFOB board were unable to identify a viable way forward given the trading losses and the inability to pay an economic milk price.

As such, they were left with no option than to invite the appointment of receivers.”

Mr Oldfield said his team would be focusing its initial efforts in working with the DFOB key suppliers and customers to keep the daily collection and supply of milk flowing.

“This will not be easy, but with the help of key hauliers and our customers I hope to be able to collect and distribute the vast majority of DFOB milk.

“I will also be focusing on the sale of the Groups’ hard cheese and liquids businesses to seek to try to secure the significant number of jobs in those businesses.”

Milk quota broker agent Ian Potter said farmer suppliers faced losing an estimated £14,000 each in unpaid milk on top of an average farmer investment of £25,000 which has already been lost.

“It will undoubtedly be quoted in future and may well deter others from setting up co-operative ventures. But at least DFOB has now been taken to the vets and put out of its misery.”

DFOB chairman Lord Grantchester said company directors had worked tirelessly to restructure the business and provide its members, employees and customers with certainty going forward.

“Clearly, the decision to invite receivers is not an easy one, but the board was unfortunately left with no alternative.”

Lord Grantchester said the board would do whatever was appropriate to assist the receivers in achieving this outcome.

“I would like to thank all of those members, employees, suppliers and customers who have shown their support for DFOB through these extremely difficult times.” 

Dairy Farmers of Britain is one of the UK’s largest milk co-operatives.

It has some 1800 dairy farming members who supply over 1 billion litres to the food and drink industry, comprising 10% of UK milk production.

The cooperative employs over 2200 staff across five liquid milk dairies, two cheese creameries, an ingredients plant and 50 distribution depots.

The company was established in 2002 by the merger of Zenith Milk and The Milk Group, using a business structure based on the European co-operative model.

Farmers set out to create a vertically integrated dairy processing business that would manufacture and market a variety of high quality value-added products.

Members invested more than £52m pounds to help pursue their goals.

The news came as farm leaders urged retailers to pay dairy farmers a fair price for milk or risk ruining the future of the industry.

Retailers, discounters and the food industry must help increase confidence among dairy farmers to stop them leaving the sector, they said.


DFoB member? Distressed or troubled about what the news might mean for your business? Don’t suffer in silence – www.farmcrisisnetwork.org.uk