Mike Allwood is owner-
occupier of a 82ha
(200-acre) farm near
Nantwich, Cheshire. The
175-cow dairy herd block
calves during May and June.
Mike is also director of Farm
Produce Marketing, based
on the farm, which
manufactures and sells
Orchard Maid frozen yogurt,
and puts packs of Cheshire
milk onto airline breakfast
IT IS ironic that after they have managed to reduce the price of milk by 20%, the Dairy Industry Federation has persuaded the Monopolies Commission to look into the Milk Marque pricing mechanism. Whatever shortcomings are found, it seems unlikely that the MMC will conclude that dairy farmers have managed to fix their wholesale price.
The biggest influence on our profitability is the top line, ie the milk income. For example, a herd of 160 cows producing 1m litres can generate an extra £10,000 by a 1p increase in milk price. Compare this to only £8960 which could be saved by a massive improvement of 1000 litres a cow in milk from forage.
Marketing is far more important to us than technical performance. For the majority who produce a commodity – milk – which is no better than that of the farmer down the road, it is essential that we club together to bargain with the large dairy companies.
There are, however, other ways to influence our end-price. One is to add value to the milk by processing it into something unique. We are trying to do this by manufacturing our frozen yogurt.
Another way of raising the price is to make the milk more desirable to the customer. We are now embarking on this route by starting a two-year conversion to organic status. I am convinced that there is a growing minority of consumers who want to buy food which is not full of "chemicals".
Converting our intensively managed all-grass farm will be quite a challenge. The main obstacles will be doing without fertiliser and sprays and coping with the vet restrictions. *
Converting his intensively managed, all-grass farm to organic status will be quite a challenge for Mike Allwood and his staff over the next two years.