Dairies start to withdraw price cuts

Pressure is mounting on Arla and Robert Wiseman Dairies after their competitors withdrew milk price cuts planned for 1 August.

Dairy Crest became the first major processor to withdraw a 1.65p/litre cut, saying it would leave its standard litre price at 26.59p/litre.

First Milk followed suit shortly afterwards, withdrawing similar plans to reduce the milk price to farmers in its liquid and balancing pools.

The news broke on Thursday (26 July) in a deal that saw protesting farmers agree to lift a 24-hour blockade of Dairy Crest’s processing facility at Foston, Derbyshire.

Dairy Crest said it was postponing the cut for two months. In the meantime, it will work with farmers to find a long-term solution to difficulties in the dairy sector.

Producers in First Milk’s liquid pool were facing a reduction 1.7p/litre from 1 August, while those in its balancing pool faced a reduction of 0.9p per litre from the same date.

The withdrawal of these planned price cuts to the liquid and balancing pools means the standard litre prices for these pools remain at 26.05p/litre and 26.10p/litre respectively.

All eyes are now on Arla and Robert Wiseman Dairies. Talks between farm leaders and processors are continuing in the hope of an announcement sooner rather than later.

A spokesperson for Arla insisted the Leeds-based processor was “not in a position to talk about milk price”.

But she added: “We do anticipate that we will be able to make an announcement before 1 August.”

The situation appears somewhat less promising with Robert Wiseman Dairies.

“It is important to stress we are not in a position to fund a milk price at the level it was prior to the global collapse in the value of cream,” said a spokesman for the processor.

Whether this suggests only a partial reversal of price cuts remains to be seen.

But farm leaders earlier this week reaffirmed their commitment to reversing all planned and existing milk price cuts to dairy farmers by 1 August.

NFU president Peter Kendall said: “The farming community is more united than ever before and the strength of feeling on this dairy issue is increasing and not decreasing.

HE added: “We will focus the spotlight on any company that is exploiting farmers and paying crazy low prices for their milk.”

A coalition of farming groups was formed earlier this month to fight the cuts.

It brought together the NFU, NFU Scotland, NFU Cymru, the Tenant Farmers’ Association, Royal Association of British Dairy Farmers and Farmers For Action.

The coming week is expected to see the dairy coalition pull out all the stops to ensure all processors withdraw the August cuts.

A statement on the Farmers For Action website said: “All Dairy Crest milk protests have been called off immediately following talks between FFA, the rest of the coalition and Dairy Crest.”

It added: “All energy will now be concentrated on the other companies and these protests continue.”

For more on milk price cuts

See our dedicated page on the milk price crisis