09 April 1998
NFU says raw milk system doesnt work
LOW producer milk prices reflect the fact that the current supply system of raw milk in Britain is not working, according to the NFU.
In its submission to the Monopolies and Mergers Commission investigation into the milk market, the union says the existing position damages the interests of dairy farmers and fails to bring benefits to consumers.
The NFU points out that the major dairy firms in this country constitute a “complex monopoly” within the terms of the Fair Trading Act, which could damage competitiveness. “Producers are receiving ever-lower milk prices, which are not reflected in the prices of dairy products or in the retail price of milk,” the submission says.
But the union insists there is no evidence that Milk Marque, which devised the selling system for the bulk of the raw milk sold in England and Wales, behaves uncompetitively.
Ben Gill, NFU president, said: “Dairy farmers are currently facing great hardship and an uncertain future as the strength of Sterling and weak market demand force their prices down to the EU support level. But retail prices for milk and milk products are firm and the profitability of processing companies is increasing.
“We do not accept that these developments are to the benefit of consumers and know that they are damaging the interests of producers severely.”
Mr Gill added that he hoped the MMC investigation would result in pricing arrangements that improved the stability and prosperity of all involved.
For this and other stories, see Farmers Weekly, 10-16 April, 1998