UK farming unions call on milk processors to act fairly

Tensions are mounting within the UK dairy sector as processors cut farmgate prices in a bid to curb high milk volumes.

Some milk processors are now looking at further measures to reduce milk output ahead of the spring flush.

This has resulted in calls for fairness across the supply chain, with the dairy board chairs of four UK farming unions meeting in Montgomeryshire on 4 December to discuss the situation.

See also: Dairy sector plans ahead to manage excess milk volumes

An open letter has now been sent by the NFU, NFU Cymru, NFU Scotland, and the Ulster Farmers Union urging processors to act responsibly during a testing period for the dairy sector.

The letter stated that the recent drop in milk prices, coupled with costs remaining high, was putting farmers under considerable pressure.

It also mentioned the need for milk contracts to be compliant with the Fair Dealing Obligations (Milk) Regulations, which were first introduced last year.

These regulations confirm that if a processor intends to amend the terms of the contract, this must be done in accordance with the terms of the contact, and that any price adjustments comply with the regulations.

New regs tested

NFU dairy board chair Paul Tompkins said: “This is the first real test of the new contract regulations; the first time the sector has had an adjudicator overseeing compliance with the regulations.

“Farmers are also now empowered to request an explanation for how their milk price is calculated to ensure that any changes are in accordance with their contract.

“It is essential we see dairy farmers engaging with their buyers and the new regulations during this challenging period.”

Jonathan Wilkinson, chair of the NFU Cymru dairy board added: “With many dairy farmers facing a difficult winter, it is of the upmost importance that the dairy supply chain functions in a fair and transparent way.”  

Prices tumbling

Milk prices are now tumbling at an alarming rate while production costs rise for the vast majority of Scottish dairy farmers, according to Bruce Mackie, chair of the NFU Scotland milk committee.

He suggested the industry faced a difficult few months ahead and that transparency, fair play and communication between milk buyers and individual suppliers would be key.

Ulster Farmers’ Union dairy chair Cyril Orr said: “We need to see greater openness, transparency and genuine collaboration within milk pools.

“This is essential to ensure a sustainable future for dairy farmers.”