THE WELSH dairy industry faces annihilation unless prices improve enough to halt the exodus of producers, claims NFU Cymru.

Dai Davies, the union‘s deputy president, used the Welsh Dairy Show at Carmarthen to encourage members to project a positive image of milk, especially in schools.

“We have not played up the health value of milk enough to compete against the back handers the soft drinks industry is offering,” said Mr Davies.

“I understand why schools react the way they do, but we have to highlight milk‘s plus factors so that it too is made available.”

Getting more children to drink milk would increase demand and strengthen the whole market.

The alternative was the continuing low returns that were forcing more then three Welsh producers to quit every week.

The economics of dairying were such that he questioned whether other producers would take up the slack.

He was also worried whether processors would continue to send collection tankers to areas where there were few producers, he added.

“There is already a question mark in processors‘ minds over the viability of some collection routes.”

Mansel Raymond, chairman of NFU Cymru‘s dairy board, said it was essential for the UK government to take advantage of the EU concession allowing the new dairy cow premium to be paid early.

“We need it as soon as possible, cash flows are difficult, there are a lot of bills to pay at the onset of winter, and fertiliser, energy, machinery and labour costs are increasing.”

He warned that producers could not withstand any cut in farm gate milk prices, and there were no economic reasons why one should occur.

Welsh producers must get their fair share of dairy industry profits or there would be a mass exodus.

But Mr Raymond, who is a director of First Milk, said he was more optimistic than a year ago following the much needed growing investment of farmers in the processing sectors.