16 April 1998
Milk Marque chairman warns against co-op breakup
By Peter Grimshaw
FACED with suggestions that Milk Marque should be split into regional co-operatives, chairman Poul Christensen today called on producers to support MM in its bid to move into processing.
“It is perverse in the extreme for farmers organisations to get smaller when the rest of the dairy industry is rationalising and getting bigger, when multiple retailers are getting bigger and when international dairy companies are merging,” he said.
Speaking at the official opening of a new cattle complex at Lackham College, Wiltshire, Mr Christensen said the Government seemed to show little appetite for helping the countryside out of its present crisis. He said farmers would have to stand side by side in order to survive.
“This is no time to fragment. Unless farmers are prepared to pick up the mantle and create a really efficient, modern dairy industry, from top to bottom, we will find it very difficult to earn a fair price for our milk and see a sensible return for the very heavy capital investment we have made.”
Mr Christensen said that farmers in Sweden, Denmark, Holland, New Zealand, Argentina and many other countries had shown the way forward by allowing their farmer owned co-operatives to move into processing.
“To do this we need scale and equity, both of which Milk Marque has. Our members have demonstrated the will to make the necessary investment by converting their certificates of entitlement into preference shares,” he added.
He said this equity base was now the envy of many other milk supply groups, who are increasingly saying that they also need to enter the processing arena.
“Im talking about investing in our own business. I look upon Milk Marque as an extension of my own farm.”
Milk Marques first processing acquisition, the Aeron Valley dairy in Wales, will double its capacity from next Friday with the commissioning of a new plant. He told the delegation to expect more acquisitions in the future.
“I am absolutely convinced that this strategy is the only one which will give us a fair price,” he added.