Environment Secretary Liz Truss has said she will meet with members from the dairy industry this week after recent milk price falls have caused a number of protests in the past month.
"Further protests are planned for the coming week, members and press will be notified," Farmers for Action said after over 500 people attended the protest on Wednesday night in Cornwall against cuts in milk prices.
The announcement comes as the Royal Association of British Dairy Farmers said it entered talks with leading MPs to express their own concerns.
This week the Association will meet with Dairy APPG chairman and Neil Parish MP (who called a joint industry round table discussion with other MPs).
“RABDF fully understands that the current fall in farm gate milk prices reflects the global trend and shares the plight of all those involved throughout the chain. Farmgate prices have fallen by up to 30% in the last three months and there are threats of further cuts,” said RABDF chairman, Ian Macalpine.
“Dairy farmers have accepted that there will be price volatility in future, and while these current trends are extreme, we have to find a way forward to enable dairy farmers to maintain a sustainable business.
“RABDF together with DairyUK has developed the newly launched Dairy APPG which is giving us a direct route to informing MPs about the current crisis and the opportunity to consider options which will provide a solution.”
Support for dairy farmers from the public, processors and retailers is vital after farmgate milk prices have fallen by around 25% in recent months.
Speaking today at the Welsh Dairy Show, Jones, a dairy farmer from Caernarfon, said that the current situation was causing significant financial strain and called on the rest of the supply chain to take action to support milk producers at this time.
NFU Milk Board Chairman Aled Jones said, “Processors and retailers need to do more to deliver a sustainable milk price back to Welsh dairy farmers. There are a number of pricing models in the liquid milk sector that do this but with the majority of milk in Wales processed into cheese we urgently need to see these models expanded into milk that is destined for the domestic cheese market.
The Landworkers’ Alliance (LWA) said it unequivocally supports the recent round of dairy blockades launched by Farmers For Action (FFA). The LWA membership includes a number of small-scale dairy producers who, although not directly supplying to supermarkets, have been indirectly affected by recent price cuts driven by pressure from the multiple retailers.
LWA’s dairy farmers are forced to compete on price with larger-scale producers in an effort to remain competitive at the farm gate. The 3p per litre price cut since June has hit smaller farmers who are unable to achieve the economies of scale that have helped to buffer the impact on larger producers.
“The UK has lost half of all its dairy farms since 2000 thanks to neo-liberal policies that benefit processors and supermarkets. We need a new Milk Marketing Board, or something like it, to stabilize milk prices at a level that gives dairy farmers a decent living.” Says Simon Fairlie, an LWA member who runs a micro-dairy in Dorset, “I support direct action. The original Milk Marketing Board was formed in 1933 after mass demonstrations by dairy farmers and that is the only way we will ever get justice today.”
The LWA is an official member of the international peasant farming movement La Via Campesina which represents 200 million small-scale producers around the world. We campaign for the rights of small-scale producers and lobby the UK government and European parliament for policies that support the infrastructure and markets central to our livelihoods.
Speaking ahead of the South West Dairy Event, NFU dairy board chairman Rob Harrison said: “Dairy farmers will be anxiously watching global markets for signs of an upturn and when it happens it is important that farm gate milk prices respond quickly and positively.
“It is more important now than ever before that food businesses and retailers pull their weight when it comes to delivering a sustainable price for dairy farmers and back British farming. Some, but by no means all, retailers have determinable milk pricing mechanisms. We’d like to see more retailers take the lead of the likes of Tesco, Sainsbury’s, M&S and Waitrose, whose pricing mechanisms give farmers some certainty over price. There are a number of opportunities for business in the supply chain to do more in liquid, cheese and other contracts.
“While more can be done proactively, it’s also important to remind retailers now is not the time to take advantage by applying pressure for price cuts as any volatility in the market could put a huge strain on the whole supply chain which would make the situation even worse.”
But Mr Harrison said the long term outlook for dairy farmers was still very positive.
“The UK dairy industry is operating competitively in a growing global market – the future remains bright, but we need to work together to ensure the foundation of the industry, our farmers, have a future.”
Why is the price of milk falling?
British consumers say they want to back dairy farmers after learning that the price they are paid has dropped significantly in the past few months. But why has the price of milk fallen?
"Just think the problem is they are little fish in a very big pond and the likes of the multiple retailers have got bigger flippers in this big pond," Farmers for Action said.
"But you see when you keep getting excuse after excuse to drop the farmgate milk price, sometimes we may reach the wrong conclusion. If we had transparency within this industry which after all is a supply chain, we may well sort out the ongoing problem."
There are a lot of farmers across the UK producing milk
In England and Wales there are more than 10,000 dairy farms, supplying a variety of dairy companies processors,who market their products in a number of different ways. Processors then sell this to shops and the food industry who then, in turn, sell it to consumers.
Not all milk is sold as liquid
Just over half of the milk produced by dairy farmersused by processors who supply fresh liquid milk through retailers, corner shops and cafes. This is almost exclusively British and is not traded globally, but is subject to a competitive tender process where people bid for the contracts. Most of this milk is sold as skimmed and semi-skimmed, so liquid processors end up with a surplus of cream to be sold as retail, wholesale, or to be made into another product, such as butter.
The value of butter on international markets affects the value of milk
Butter, which can be stored, and bulk cream are traded on domestic and international markets. The recent fall in the value of these products has reduced the value of this part of milk.
The cheese market is very competitive
Another large portion of our milk produced is made into cheese. In the UK this is mainly cheese, as well as a lot of other specialist cheeses from expert cheese makers of all sizes. This cheese is internationally traded and subject to tenders, so there is a lot of competition from other countries across Europe and the rest of the world to sell cheese in England. If you want to back British farming you can buy British and look for the Red Tractor on the label.
Milk is made into all sorts of products... and the marketplace is, again, very competitive
The rest of UK milk is made into a variety of products, including yoghurt, milk powders and a lot of other tasty and nutritious products.
All of these are subject to competition from global markets and the rest of Europe. When one segment of the dairy industry is more profitable than others, it is often possible for processors to change the amount of each product to meet demand from consumers and to try and generate higher returns. Because of this highly competitive marketplace, all parts of dairy are affected by international dairy markets.
As farmers are at one end of the supply chain they get paid what is left and can be put under pressure when global markets drop in value.
