Farmers divided on how to tackle milk price crash

Dairy farmers remain divided over what action is needed to stop the milk price crash.

Protests, milk supply controls and ways to ease the volatile prices were discussed at a heated public debate at The Dairy Show in Somerset on 1 October.

Arla Milk Co-operative chairman Jonathan Ovens said falling returns were purely down to world production outpacing slower growth in demand for dairy products.

See also: Five charts that explain the milk price crash

But he said questions remained about how much the global price should affect how much British farmers were paid.

“We have never seen the benefit of the highs in the market so we should not be seeing the lows,” he said.

Next to speak, Farmers For Action (FFA) chairman David Handley said most British farmers seemed happy to accept milk prices tumbling below 30p/litre.

He said farmers needed to take more responsibility and speak to their milk processor before upping production or putting on more cows.

“When you produce milk, just because it goes into a big lorry and out of the farm gate it does not mean it is not your problem.”

He added that FFA would launch protests against a milk processor in the next four days, but if farmers did not want to join in they should at least think about their production levels.

Mr Handley also unveiled a “milk pricing formula” for debate and scrutiny, which would offer a guaranteed price for an agreed volume of milk and an open-market price for any extra.

NFU dairy board chairman Rob Harrison said that no single part of the supply chain was to blame for the current price problems.

He said work was needed on tools to manage volatility, such as formula contracts and futures markets, supermarkets like Morrisons doing little to support dairy farmers should up their game, and a national milk day should be created.

“Our prices have as much to do with what is happening in China and Chad as what is happening in Cheshunt and Claygate,” Mr Harrison said.

He said Mr Handley’s proposal was a “good start for debate” but new supply controls were not the answer, as nothing could be done to rein in Australian and New Zealand production.