Milk Marques agenda alarms processors
MILK MARQUE believes its finances are strong enough to invest £100 million in new processing capacity which would set it up as a significant rival to the major dairy processors.
The farmer-owned co-operative believes it can take on the majors such as Unigate, Express Dairies and Dairy Crest without calling for more equity from farmers. The investment would enable it to process 1bn litres of milk a year.
This would reverse the separation of marketing from processing which took place in 1994. Prior to that, the old Milk Marketing Board – a statutory authority – had owned Dairy Crest.
The threat has alarmed processors at a time when the Monopolies and Mergers Commission is investigating the supply of milk in the UK after complaints about Milk Marques system of auctioning contracts for milk twice a year.
Milk Marques new investment would absorb the 10%-15% of the 6.5bn litres of milk it has failed to sell through its auctions, says the Financial Times.
- Milk Marque dismisses DIF processing capacity claims, FWi, Wednesday (22 April) Click here
- Financial Times 24/04/98 page 25