22 September 1995

An artificial asset

MILK quotas have given farmers an artificial asset, the cost of which prevented both business expansion and new entrants.

Roger Clarke, procurement and planning director with MD Foods, told delegates at the Plunkett Foundations milk conference this week that quotas had effectively fossilised national dairy sectors as they were at the beginning of 1984.

"Quotas have given farmers an asset, but one which is artificial and, in the longer term, unreliable and transient," he said.

But in the short term quotas would continue. "The task is to modify and improve the system."