12 October 1999
Deadline looms for milk campaign

By Liz Mason

DAIRY farmers have less than a week to decide whether they want to fund a nationwide advertising campaign aimed at boosting sales of liquid milk.

Polling papers which were sent to dairy producers last month must be returned to the Ministry of Agriculture by Friday (15 October).

Farmers are being asked to contribute 0.03ppl towards the advertising campaign estimated to cost the average producer about £130 a year.

A steady decline in milk consumption over the past five years has prompted the National Farmers Union to urge producers to back the campaign.

It believes that advertising milk on a nationwide basis could help stop the decline in household sales and even stimulate an increase in sales.

The return could be as much as £5 for every £1 invested by producers in a generic promotional campaign, it says.

This assertion is based on research conducted last year for the NFU and Milk Development Council (MDC).

 
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Tom Hind, NFU assistant milk adviser, says the research estimates that a £10 million milk promotion campaign could raise the raw milk price by 0.1ppl.

But he warned: “There can be no guarantees. But we know that if we dont do something as an industry it will only get worse.”

The NFU recognises that some producers feel that the MDC should pay less for research and development and more on promotion.

But the MDCs remit is not up for negotiation – producers will have to wait until 2003 to have their say on its future.

“It is vital producers cast aside any disapproval of the MDC and vote in favour of generic milk promotion,” says the NFU.

Dairy processors have agreed to put in matched funding, which means producers and processors contributing about £3.5m each a year to fund promotion.

Jim Begg, director general of the Dairy Industry Federation, says the organisation is asking dairy companies to guarantee support for generic promotion.

But Gloucestershire milk producer John Round believes the poll should ask producers whether they rather their money went to the MDC or to advertising.

Mr Round would rather see one third of the current 0.04ppl MDC levy spent on research and development and two thirds on promotion.

“Finding extra markets for milk is far more important than saving an extra 0.3p a litre on costs.”

Nevertheless, Mr Round will reluctantly vote yes to a campaign.

“I agree with advertising on principle,” he says, but dairy companies must also contribute, given the big profits being made in the retail and wholesale sectors.

Leicestershire producer Peter Dixon Smith supports the principle of generic milk promotion but fears any benefit will not be passed back to producers.

“At the moment because the price of milk has come down, buyers are getting far more of the profit because they havent dropped the price of liquid milk,” he says.

West Sussex producer Tony Hextall expresses the same fears and is unsure producers will benefit. But he too will support generic promotion.

“At the moment supermarkets are making a lot more from milk than we are.

“But we have got to do something, although I dont think an average of £130/farmer is enough.”

John Sumner, policy adviser at the Royal Association of British Dairy Farmers, says that producers should vote yes but must keep an eye on how the money is spent.

“Producers must keep the pressure on MDC and the National Dairy Council,” he says, adding that other issues such as improved packaging should also be addressed.