Welsh dairy farmers expect their milk buyers to seek markets that maximise in full the value of milk and dairy products in order to secure future supplies - that was the clear message coming from NFU Cymru milk producing members during meetings held earlier this week.
NFU Cymru Deputy President Stephen James and NFU Cymru Milk Board Chairman Aled Jones met with dairy farmers in Clwyd and Montgomeryshire this week to discuss dairy markets, uptake of the voluntary code and work of the Dairy Coalition.
Aled Jones said, "Some significant changes have been achieved to the environment in which the dairy industry operates since the events of the summer of 2012. We’ve seen significant movement by most processors in signing up to the Dairy Industry Code of Best Practice for Contractual Relations. Some are also progressing more modern and dynamic pricing initiatives.
"The last few months have also seen the general public having a much better understanding of the situation facing British dairy farmers; which can only be good in encouraging a fair and open market place.
"We now need that market place to work effectively for everyone. For far too long we as dairy farmers have always suffered the lows in the market and never receive the rewards when the markets are at a high. We are in that situation now again where there is an insatiable and growing demand for dairy products globally. Recent global market indicators and auction results show a huge increase in the value of dairy commodities and these have risen by almost 40% since early March.
"Nearer to home, European auctions have seen Gouda and Emmenthal values climbing and the UK dairy indicators AMPE and MCVE have reached 32.4 and 33.0ppl respectively for March, up 34% and 5% on the year. In fact we would estimate that recent cream valuations would put AMPE above 35ppl today. This is all good positive news and there is only one way in which the farm-gate price of milk should go - and that is up.
"We do expect our milk buyers to seek the markets that maximise in full the value of milk and dairy products. If they don’t and if farmers do not see price rises then future supply will not be secure. The backdrop to all this is that farmers are emerging from one of the hardest farming years in decades.
"Our message is a simple one to all those who buy, use and sell the milk that farmers’ produce - farmers need and deserve a market price that fairly reflects the growing value of raw milk. The return to farmers needs to allow them to reinvest and gives them confidence for the future.
"I think it’s clear now, at this point in time, if any part of the UK market fails to achieve that, they do risk losing supplies of dairy products to those companies who are taking the future of the British dairy industry seriously. The NFU will be meeting shortly with retailers and food service companies and the message is as valid to them as it is to milk processors."
