Dairy coalition leaders are “confident” farmers will regain some of the money lost in the spring milk price cuts following talks with Wiseman/Müller and other major dairy processors.
NFU president Peter Kendall and Farmers for Action chairman David Handley held discussions with Ronald Kers, chief executive of Müller UK and Ireland Group, at Stoneleigh on Thursday (23 August). The talks are part of continuing discussions that Wiseman has been having with farming unions.
Dairy farmers used tractors and trailers to blockade a Müller plant in Market Drayton, Shropshire last Friday (17 August) – the second time the site has been targeted.
Speaking after the talks, Mr Handley said: “It was a very robust meeting. There was a major commitment from Müller chief executive Ronald Kers that he wanted to work together to try and solve the problems of the dairy industry.
“We agreed we need to tear up what we have got and start with a clean sheet of paper and reform the way we buy and pay for milk; within that would be a cost-of-production formula.”
Farmers for Action has set Wiseman/Müller a deadline of seven to 10 days to return some of the money to farmers that was lost in during the spring milk price cuts in May/June.
“Mr Kers was optimistic that could be achieved by I October, but not by 1 September as we had requested,” said Mr Handley.
“We said they have got a week to 10 days to come up with some numbers. Farmers do not want bluff and promises – they want money.”
A spokesman for Müller/Wiseman said: “We had robust but constructive discussions with the NFU and FFA and have committed to engaging with the Coalition on the relevant parts of its 10 point plan and other industry issues.
“In addition we confirmed that we will shortly be in a position to discuss details of an initiative agreed with farmers who supply the Company which will hopefully lead to new recommendations on how farm gate milk could be valued in future.
“We believe that it is time to start to move on from what has been a very difficult period for the dairy supply chain and we welcome discussion which helps to achieve this end.
“We are attuned to changes in the market for fresh milk and as all of the factors which determine its value firm, we will seek to reflect this in higher milk prices.”
Rob Newbery, NFU chief dairy advisor, said the union was “committed to the dairy coalition’s short and long term objectives”.
“The short term objective of reversing the price cuts has partly been achieved by stopping the effect of the 1 August price cuts, but farmes need money taken in May and June to be returned, as they face a winter of high feed costs,” he added.
“Looking at our longer-term objectives, we are encouraged by the Wisemilk initiative and commitment to farmers this represents. Only when processors start to value milk in a more sustainable and transparent way, will farmers start to have confidence in their future relationship with milk buyers.
“The NFU has committed to work with Wiseman and the partnership board to ensure this project delivers a more determinable and fairer price for farmers.”
The dairy coalition has been locked in discussions with a number of dairy processors this week. And Mr Handley said he now felt confident that dairy farmers would regain some of the money lost in the spring milk prices cuts.
“I would be very confident that farmers will be getting some money back on their milk cheques from 1 October,” he said.
“We are very slowly tracking the money down. We know where it is.
“It was never going to be easy, but we feel now that there are indications from some processors that there is money on its way back.”
Major milk processing companies, including Robert Wiseman Dairies, Dairy Crest and Arla Foods, cut the prices they paid farmers for their milk in spring by about 2p/litre.
The same companies pulled the 1 August price reductions of 1.65 to 2p/litre – which would have seen many farmers paid less for milk than it costs to produce – following a string of peaceful protests by dairy farmer and public anger.
However, Mr Handley said he was less confident that the voluntary code of practice on dairy contracts would be agreed in time for Livestock 2012.
Delivery of the code and making processors abide by the new code were were two action points adopted by the dairy coalition in its 10-point plan, announced last week.
Farm minister Jim Paice has said he would like to see the code in place by Livestock 2012 (4-5 September) but Mr Handley said it could take longer to be agreed, “into September, October or even beyond”.
“There is still an awful lot of work needed to convince everyone to sign up to the code. It would mean decades of policies being ended virtually overnight,” he said.
“I just cannot see the majority of the industry being able to do that. Some of the most brazen processors have said they will not sign it.”
A dairy coalition meeting is due to take place at the NFU offices in Stoneleigh today (Friday 24 August). Leaders will decide whether to resume the blockades against milk processors after a quiet week.
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