17 August 2001

Premium for green milk

By Wendy Owen

North-east correspondent

A 2.7p/litre premium is being offered to farmers supplying milk for a new environmentally friendly liquid branding scheme to be launched this autumn.

The company behind the White & Wild milk brand is Agri-Trade Direct, a former agricultural marketing group that is now a farmers buying consortium with 200 members. The project is linked with the Wildlife Trusts, a country-wide organisation which has added its logo to the milk cartons. The trusts, which have more than 300,000 members nationally, will receive 2.3p for each litre of milk sold.

Agri-Trade managing director, Ken Whitley, expects the brand to command a 6p/litre premium at point of sale and predicts it could corner a 5% market share. He says it will break new ground because consumers have an assurance that the milk they are buying will benefit the environment.

"Farmers selling milk to us receive a premium but first they have to pay for a visit from the Farming and Wildlife Advisory Group, which will draw up an action plan to encourage wildlife on their farm," explains Mr Whitley. "Once they have accrued a certain amount of premium, they will be asked to carry out environmental improvements out of their bonus."

But he stresses that work such as hedge-laying and pond development will be tailored to individual farms and that improvement targets will be realistic. For the venture to work, he insists that farmers will be left in profit after selling to the scheme.

"An average dairy farm with 100 cows could get more than £16,000 a year in premium. Some of this will have to be spent on environmental work but there will be money left over. We are not suggesting that our farmer suppliers have to be organic or that their farms have be perfect."

Milk for the White & Wild brand will initially come from members of Sorn milk, a 48-strong producer group based in the Scottish borders.

"We are aiming for sales of 670,000m litres of milk eventually," says Mr Whitley. "That would support 1000 farmers and cover 300,000 acres of farmland. We are starting off with full-fat and semi-skimmed milk, but there are lots of possibilities to develop more dairy products."

The project has not yet secured a firm sales contract with a buyer, as retailers want to see the product before committing to it, he adds. "The supermarkets have expressed a lot of interest and they do not seem to have a problem with the fact that the milk will cost more. They understand that this is an added-value product and see it as a way to support the sale of wildlife-friendly foods." &#42