Dairy farm­ers’ pa­tience wear­ing thin

The Oban Times - - Farming -

DAIRY farm­ers’ pa­tience is wear­ing thin as mar­ket in­di­ca­tors for dairy com­modi­ties soar to lev­els not seen since the heady highs of 2013, Scot­land’s Na­tional Farm­ers’ Union has ar­gued.

By com­par­i­son, far­m­gate prices have as yet failed to re­spond, lead­ing to anger and frus­tra­tion at farm level, the union says.

Ac­tual Milk Price Equiv­a­lent (AMPE) and Milk for Cheese Equiv­a­lent ( MCE) track the ba­sic whole­sale com­mod­ity prices for but­ter, skimmed milk pow­der, mild cheese and cheese by-prod­ucts.

While the Na­tional Farm­ers’ Union Scot­land ( NFUS) ac­knowl­edges that they do not set the price, th­ese have risen from a low of around 17p per litre a year ago to al­most 37p now. That, it said, is ‘ a stag­ger­ing in­crease that has yet to be fully re­flected in the price farm­ers re­ceive for their milk. Far­m­gate prices by com­par­i­son have risen by only 7p in the same pe­riod to an av­er­age of 26p or 27p per litre.

NFUS milk com­mit­tee chair­man James Rankin said: ‘ By any­one’s arith­metic, this does not add up.

‘Milk buy­ers fail­ing to pass on mar­ket re­turns is clearly un­ac­cept­able in any cir­cum­stance, but par­tic­u­larly at a time when dairy farm­ers are re­cov­er­ing from the deep­est price squeeze many have ever ex­pe­ri­enced.

‘There is no rea­son­able ex­cuse. Pro­duc­tion is muted, de­mand is strong and while the pro­cess­ing and re­tail sec­tors can cite con­cerns about over­sup­ply and be­ing com­pet­i­tive, there is no rea­son to hold back prices at this time, other than to man­age their bal­ance sheets and risk at the ex­pense of farm­ers.

‘NFU Scot­land and our fel­low farm­ing unions are, as ever, very open and will­ing to work with the dairy sup­ply chain to man­age risk and op­por­tu­nity.

‘We ac­knowl­edge that vol­ume man­age­ment and mar­ket com­pet­i­tive­ness are real is­sues, but we are very con­cerned that farm­ers are once again not be­ing fairly or re­spect­fully treated in terms of re­ceiv­ing a rea­son­able re­ward from such a strong mar­ket.’

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