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Dairy company will pay farmers more for milk Dairy company will pay farmers more for milk
(about 1 month later)
A dairy processor has announced an increase in the price it pays farmers for their milk as a new voluntary code of conduct for future contracts for milk supplies is expected to be published.A dairy processor has announced an increase in the price it pays farmers for their milk as a new voluntary code of conduct for future contracts for milk supplies is expected to be published.
Farmers supplying milk processor Arla will be paid an additional 2.5 pence per litre from the start of October as the company said it was adopting a more transparent milk pricing and sourcing strategy.Farmers supplying milk processor Arla will be paid an additional 2.5 pence per litre from the start of October as the company said it was adopting a more transparent milk pricing and sourcing strategy.
Arla's standard price, as of next month, said its litre price will increase from 27 pence to 29.5 pence. It is being implemented by Arla Foods Milk Partnership, a group of 1,400 farmers who supply milk to the company.Arla's standard price, as of next month, said its litre price will increase from 27 pence to 29.5 pence. It is being implemented by Arla Foods Milk Partnership, a group of 1,400 farmers who supply milk to the company.
Farming minister Jim Paice is expected to unveil a new code for the dairy industry designed to make the sector fairer after a draft deal was brokered between farmers and processors in July.Farming minister Jim Paice is expected to unveil a new code for the dairy industry designed to make the sector fairer after a draft deal was brokered between farmers and processors in July.
It could provide a solution to the ongoing dispute that has blighted the industry throughout the year with farmers blockading milk processing plants.It could provide a solution to the ongoing dispute that has blighted the industry throughout the year with farmers blockading milk processing plants.
At the time, the milk processing companies said they had no other option as the selling price of cream on the commodities market had fallen sharply over the last 12-18 months. But during the dispute, farmers claimed the payments did not cover their production costs and could have forced many out of business.At the time, the milk processing companies said they had no other option as the selling price of cream on the commodities market had fallen sharply over the last 12-18 months. But during the dispute, farmers claimed the payments did not cover their production costs and could have forced many out of business.
The National Farmers Union says the cost of production of a litre of milk is about 30 pence.The National Farmers Union says the cost of production of a litre of milk is about 30 pence.
The Arla decision is a victory for the Dairy Coalition, made up of the National Farmers Union, Farmers for Action and other campaigners, who have been seeking to increase the amount farmers are paid for milk. In many cases, the price paid was well below the cost of production. The protestors targeted the Leeds-based company and other processors, including Dairy Crest and Robert Wiseman, in blockades earlier this summer over the price cuts.The Arla decision is a victory for the Dairy Coalition, made up of the National Farmers Union, Farmers for Action and other campaigners, who have been seeking to increase the amount farmers are paid for milk. In many cases, the price paid was well below the cost of production. The protestors targeted the Leeds-based company and other processors, including Dairy Crest and Robert Wiseman, in blockades earlier this summer over the price cuts.
The AFMP chairman Jonathan Ovens said the increased cost of production is very real for members but they don't believe a cost of production model is the long-term answer as it would lead to a dairy market that is uncompetitive. He said they had worked tirelessly for months to develop the model.The AFMP chairman Jonathan Ovens said the increased cost of production is very real for members but they don't believe a cost of production model is the long-term answer as it would lead to a dairy market that is uncompetitive. He said they had worked tirelessly for months to develop the model.
Peter Kendall, president of the NFU, said the company has responded to the challenge in a transparent and meaningful way but its important that price increases are long lasting and industry-wide.Peter Kendall, president of the NFU, said the company has responded to the challenge in a transparent and meaningful way but its important that price increases are long lasting and industry-wide.
Dairy UK says a deal with the NFU and NFU Scotland will promote trust between milk producers and buyers. In July, following protests and discussions with customers, Arla decided to abandon a price cut.Dairy UK says a deal with the NFU and NFU Scotland will promote trust between milk producers and buyers. In July, following protests and discussions with customers, Arla decided to abandon a price cut.
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