Dairy ‘transfer window’ open after price rises

Dairy farmers could have the chance to exercise their right to a three-month notice period and get a new milk buyer in place by the new year following the latest round of milk price rises.

Under the terms of the dairy voluntary code of practice, producers who are not members of a co-op, where the milk buyer sets the price at their discretion, have the option to give three month’s notice to quit following a milk price change. This does not apply to those on formula contracts.

“While having the opportunity is one thing, whether it is of value to many producers depends on where they farm and the alternative buyers available,” said consultant Nick Holt-Martyn from The Dairy Group, who coined the phrase “dairy transfer window”.

“Most buyers are touting for increased supply, but there are countless examples of producers jumping from frying pans into fires, so it’s a case of look before you leap.”

Farmers needed to look past the headline price and assess how any potential new contract would perform against their farm’s production system, he said.

Producers should also compare the milk price of any new milk buyer against their existing buyer’s price over the past three years, he said.

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