25 July 1997

Milk Group acquisition is move to processing

FARMER-owned dairy business, The Milk Group, has acquired a majority shareholding in Peterborough-based processor, Nene Valley Foods.

As such, it is the first of the new generation of producer groups to move into processing in a bid to secure a better return for its members. (Other groups such as Long Clawson Dairies in Leicestershire and South Caernarfon Creameries have a history of processing that predates market deregulation in 1994.)

Nene Valley processes some 30m litres a year into added value products such as soured cream and yogurt generating a turnover of £12m.

According to Milk Group spokesman, Richard Sheard, the acquisition will enable the company to balance its supplies better, to expand its range of products from just raw milk and increase returns for members at a time when prices are under pressure.

Currently, The Milk Group has a pool of more than 300m litres from almost 400 farmers, with more due to join on Oct 1. The move into processing was not necessarily the start of a trend, he said. "But we will certainly look at opportunities as they arise."n