Dairy deficit deepens

IMPORTS OF cheddar cheese and other dairy products pushed the UK‘s dairy deficit to record levels in 2004, and figures from January look set to widen the gap.

Data from the Milk Development Council put dairy imports at £1.43bn last year, compared to exports of just £691m, widening the deficit to £744m.

It builds on the trend of the last ten years, which has seen the gap widen from £250m in 1995.

“The fact that milk production dropped heavily in 2004 will have made most people decide to put milk into high value products like cheese rather than through Westbury to process into commodities,” said MDC Datum economist Colm O‘Reilly.

As a result, cheddar imports last year were up over 20,000t compared with 2003, mostly from Ireland, and butter imports increased by 7000t.

But speciality cheese imports also grew 9000t to more than 226,000t, while exports of cheese from the UK rose just 11,000t to 90,000t over the same period.

“People‘s tastes are changing, and they want more choice,” said Mr O‘Reilly. “That means more speciality cheese, and unfortunately we don’t produce so much of that in the UK.”

The figures support comments made by the NFU‘s dairy board chairman, Gwyn Jones, at the Union‘s council last week.

He told delegates that UK dairy processors lacked vision and innovation and should face competition from international investors if they were not prepared to do the job farmers wanted.

Every tonne of dairy product that came into the UK was worth an average £1500, while each exported tonne was only valued at £900, he added.