Where’s the plan for UK dairy?

A handbrake turn is needed to change the direction of the UK milk industry from churning out milk, butter and powders so it can start to replace higher value imports and get producers off the bottom of the European milk price league table.

It was essential to get to a better place, First Milk chief executive Kate Allum told producers and milk industry specialists at the Semex UK Turning Towards Tomorrow conference in Glasgow.

“We can sit on the sidelines or choose to take action. Other countries have been working on a response to quota removal for years,” said Ms Allum, who runs the UK’s largest dairy farmer-owned milk business.

“There’s a possibility that DEFRA or theNFU or Dairy UK has a secret plan about key investment they haven’t shared with us yet, but I’m guessing not.

“The danger of no plan is we’ll be stuck in commodity markets while others who’ve invested will get access to added value markets. But there’s not a day to waste because we’re behind other countries and they won’t step aside easily.”

Ms Allum insisted the UK dairy industry had to gain access to premium markets and maintain security of supply but that meant new partnerships and investments.

“At First Milk we want ownership of these assets to sit with farmers and the supply chain they’re part of, not with anonymous people who care only about dividends rather than the long term progression of our industry,” she said.

“No doubt the UK market place will be the bedrock of First Milk business. We have a population of 60 million on our doorstep so which is a powerful market. But we’d be irresponsible not to explore other groups of markets in order to increase our returns to producers and secure the long term survival for UK customers and consumers at the same time.”

Futures contracts: farmer views wanted

Do you use futures and options markets to help you manage risk? Or are you interested to learn more? Farmers Weekly is keen to find out the extent to which UK farmers use these markets. Complete our survey here.

Take the survey

Futures markets and commodity risk management online course:

  • Risk management strategies for a more predictable financial performance
  • Educated conversations when collaborating with your advisors
  • Negotiate better prices with your grain merchants

View course