Milk price row: Farmers and ministers hold 'crisis' talks
Milk price row: Farmers and ministers in 'productive' talks
(about 2 hours later)
Farming leaders and ministers from across the UK are meeting to discuss what the National Farmers' Union calls a "crisis" over low milk prices.
Farming leaders and ministers say they have held "productive" talks on the future of dairy farming in the UK following protests over milk prices.
Environment Secretary Liz Truss has said the situation is "very serious".
Supermarkets were urged to use better labelling and promotion of British produce, after ministers from Scotland, Wales and Northern Ireland met with farming representatives in London.
Farmers say a reduction in global demand for milk has led to an over-supply in the UK, depressing prices.
The National Farmers' Union said the government was sending the "right messages" but protests would continue.
After protests, Aldi, Lidl and Asda have said they will pay a minimum price of 28p per litre. Morrisons will pay 26p per litre from later this month.
It said farmers remained "desperate".
Waitrose, Marks & Spencer, Tesco, the Co-op and Sainsbury's already pay more than the cost of production for milk.
NFU president Meurig Raymond said he was hopeful minsters would be "talking to everyone in the supply chain" to promote British produce in the supermarkets, and to "come up with fairer contracts".
The industry estimates the average cost of production at 30-32p per litre.
Environment Secretary Liz Truss described the meeting as "helpful and productive".
Ms Truss is hosting Monday's summit in London with farmers' leaders and her ministerial counterparts from Wales, Scotland and Northern Ireland.
"It was an encouraging meeting and I believe we can help build stronger foundations that give the industry the long-term stability and commercial opportunities it needs to manage global volatility," she said.
Writing in the Sunday Telegraph, she said she wanted to improve labelling to make it easier for customers to buy British - currently much of the butter and cheese bought in the UK is made from imported milk.
Ms Truss said the Department for Environment, Food and Rural Affairs would be putting together a working group "to talk to supermarkets and other providers about how we can get a better branding and better labelling of those [British] products".
The National Farmers' Union's head of food and farming, Phil Bicknell, said he wanted government ministers to recognise "that something has gone fundamentally wrong with the supply chain" in the dairy industry.
Farmers argue a reduction in global demand for milk has led to an oversupply in the UK, which has in turn seen prices plummet.
Monday's talks follow demonstrations which have seen farmers bringing cattle into supermarkets and buying up stocks of milk from store shelves before giving it away for free.
Why has the price of milk fallen?
Why has the price of milk fallen?
Why is the milk row happening?
Why is the milk row happening?
Monday's talks follow demonstrations against supermarket chains over the past few weeks.
Aldi, Lidl and Asda have since said they would pay a minimum price of 28p per litre. Morrisons will pay 26p per litre from later this month, and it has also launched a brand of milk and cheese which it says will directly support producers.
Protests have seen farmers blockading distribution centres and buying up stocks of milk from store shelves before giving it away for free.
Waitrose, Marks & Spencer, Tesco, the Co-op and Sainsbury's say they already pay more than the cost of production for milk.
Morrisons, meanwhile, has launched a Milk for Farmers cheddar cheese, which will cost 34p-a-pack more than its standard cheddar and will deliver the equivalent of 10p-a-litre back to farmers who supply the milk.
The industry estimates the average cost of production is 30-32p per litre.
This will be in addition to its new brand of premium milk announced last week, which will see 10p per litre going to farmers.
Morrisons said it hoped this offer "along with the other initiatives we have announced this week will help our suppliers to better support British dairy farmers".
What is the 'milk bucket challenge'?
What is the 'milk bucket challenge'?
By BBC's environment correspondent Claire Marshall
By BBC environment correspondent Claire Marshall
This is the dairy farmers' version of the ice bucket challenge.
This is the dairy farmers' version of the ice bucket challenge.
They say that milk is so cheap, they might as well just let it wash away.
They say that milk is so cheap, they might as well just let it wash away.
The Farming Community Network (FCN) has organised the milk bucket challenge in order to raise funds and awareness of the crisis in the milk industry, which has suffered months of price drops.
The Farming Community Network has organised the milk bucket challenge in order to raise funds and awareness of the crisis in the milk industry, which has suffered months of price drops.
Caroline Trude, chairwoman of the Devon Federation of Young Farmers' Clubs, has helped to organise the challenges.
Caroline Trude, chairwoman of the Devon Federation of Young Farmers' Clubs, has helped to organise the challenges.
She told the BBC that they poured about 800 litres (176 gallons) of milk over their heads during the challenge.
She told the BBC they poured about 800 litres (176 gallons) of milk over their heads during one challenge. This cost at least £240 to produce. However, at the current rate, farmers were only being paid about £184 on average for that amount from a processor.
This cost at least £240 to produce. However, at the current rate, farmers were only being paid about £184 on average for that amount from a processor.
Ms Trude said it raised the profile of the issue without disrupting the public.
Ms Trude told the BBC the milk bucket challenge raised "another dimension" to the protests.
Matthew Weaver took two cows into a branch of Asda in Staffordshire earlier this month.
"A lot of people have very different ideas," she said.
He said he felt the support from customers had been "the driver for the success we've had so far".
"Some supermarkets are poor on the milk side of things, but they are very good at buying British meat. So this way raises the profile on your own farm without disrupting the general public."
John Allen, a dairy industry expert from Kite Consulting, said low prices meant farmers would go out of business but the market would then "self-correct".
Matthew Weaver took two cows into a branch of Asda in Staffordshire earlier this month in protest at low prices.
"Probably next year we'll see a significant turnaround and consumers will have to be paying significantly more for their dairy product," he said.
He told BBC Radio 5live progress had been made: "We feel like we've won the argument actually.
The issue of milk prices in the UK will again be raised at a European Commission meeting next month.
"You talk about pressure from farmers to retailers, but I would like to think that it's more pressure from the general public and the support we have from our customers, the consumers, which we are so appreciative of, because we think that has been the driver for the success we've had so far."
Mr Weaver said still more work needed was needed to boost the price of milk used as an ingredient in other products.
John Allen, a dairy industry expert from Kite Consulting, told the BBC small fluctuations in global milk markets had a huge impact on prices in the UK, creating a very difficult environment for farmers.
"The low prices will ultimately mean people will go out of business and then the market will self-correct and probably next year we'll see a significant turn-around and consumers will have to be paying significantly more for their dairy product."
He told 5live that Tesco, Sainsbury's, the Co-Op, Marks and Spencer and Waitrose paid a guaranteed price directly to farmers.
In contrast, the more recent deal involving Asda, Lidl, Aldi and Morrisons will see a guaranteed higher price paid to Arla - Britain's biggest milk co-operative - but Mr Allen said that would probably mean it would be "diluted" and farmers would not see as much of an increase as they might expect. national
