Eroding share of milk worries Fonterra shareholders
Fonterra shareholders are concerned with a further decline in the co-op’s share of milk collected in New Zealand.
The Dairy Coalition says its new strategy will help to secure the long-term future of the industry and will focus on exposing bad practices, boosting farmers’ role in the supply chain and ensuring the supply chain is transparent and fair.
The coalition is also including cheese in its campaign, calling for own-label supermarket cheese to be British.
NFU dairy board chairman Mansel Raymond says the first priority of the Dairy Coalition is to see a fair and functioning market place for the UK dairy industry.
“All farmers should receive a fair and sustainable milk price, one which at least covers their costs to produce milk. This is the only way we will be able to ensure shoppers have the choice of British dairy products on supermarket shelves.”
Raymond says it’s clear the UK dairy market has failed. Market highs have not been passed down to the farm gate, he points out. “All milk buyers must develop their own appropriate and transparent milk procurement and pricing models that are equitable for all parties and cover farmers’ production costs.
“The British dairy industry can have a bright future if every part of the dairy market works to capture market opportunities here and abroad. We have a growing demand for fresh, British, quality dairy products from a growing world population and we must be in a place where we can respond.”
UK farmers groups last month mobilised members and staged protests UK-wide to protest price cuts of between 2.5 and 3.5c/L from August 1. The protests paid off when major processors deferred or cancelled their plans.
The UK’s largest dairy co-op, First Milk, backed down first, its chief executive, Kate Allum, saying it has a responsibility to farmers to show leadership and remove uncertainty.
“On that basis, we have decided to immediately withdraw the planned August price cuts [resulting from] moves by our liquid customers. This has been a turbulent time for the whole industry, but unless we immediately grasp the nettle, the progress we are seeing right now will be short-lived.
“Dairy farmers have spoken with one voice over the last few weeks, and they’ve made it clear they reject the existing model where they are price takers and favour working together to gain an equal seat at the negotiating table. It is therefore critical the whole dairy supply chain now looks to develop better structures and relationships for the short, medium and long term.”
Arla Foods, Robert Wiseman Dairies and Dairy Crest also dropped plans to cut the farmgate price.
