About time milk sector deals were monitored

The appointment of an adjudicator to monitor dealings in the milk sector is an encouraging step, Bridgwater and West Somerset MP Ian LiddellGrainger tells Defra Secretary Steve Barclay. But, he warns, there is much lost ground to be made up if farmers are

DEAR Steve I was considerably heartened by this week’s news of the appointment of an official adjudicator to oversee milk supply contracts.

I was further bucked to read that the role comes with the provision of teeth with which to inflict penalties where processors have been caught playing fast and loose.

My only query relating to this development is why it has taken quite so long for Defra or indeed anyone else in Government to realise the extent of the economic carnage that has been going on in the dairy sector, and to decide to do something about it.

For as long as I can remember milk prices have been pegged some 20 years behind where they should be. During my 23 years on the benches I have seen dozens of dairy farmers forced out of the sector, unable to make a living and powerless to wield any influence in getting a better deal for what they produce.

I believe a lot of the current malaise stems back to the ill thoughtout decision to scrap the old Milk Marketing Board. I know it had its critics, including many within the NFU. I know it had its imperfections. But, my goodness, it did the business when it came to getting fair prices for farmers.

Its replacement by producer cooperatives was fairly disastrous. They were being run in many cases by secondor third-division executives and it’s no wonder they failed to secure better terms: the supply side was still too fragmented. Meanwhile, farmers’ attempts to create an MMB mark 2 by various means were constantly thwarted either by politicians or by those within the industry with vested interests.

And all this time the supermarkets have merrily been flogging milk at rock bottom prices as a means of luring the punters through the doors. We have witnessed the frankly obscene spectacle of what is probably the finest and most wholesome milk in the world being discounted to the point where it has been cheaper than bottled water. How mindnumbingly crazy is that?

And the Government has appeared content to sit back in the belief that the market will somehow sort things out, shake them down and start functioning to the mutual benefit of all. Which, of course, has been the last thing that has happened.

Farmers are in a weaker position than ever. I shouldn’t need to point out to you that liquid milk is a perishable product with a limited shelf life. It has to be sold off the farm – at whatever price the market is willing to offer.

I can think of no other commercial sector where this situation pertains. If you make a car, a shirt, or a sofa you put a price on it. You don’t allow your customers to tell you how much they are prepared to pay for it.

Yet it is precisely this ruinous station which has devastated the dairy sector, driven many excellent farmers out of it, and concentrated all the commercial muscle on the other side of the farm gate.

I should like to see the adjudicator appointed rapidly and getting stuck in to sort out some of the sharp practice which continues to infect the dairy sector. But the remit has to be extended beyond the processors to the retailers, who have ultimately been responsible for exerting downward pressure on prices.

We also have to get consumers valuing milk again. Sadly its image has suffered badly from the black propaganda put about by the vegans whose own ‘milk’ substitutes are nutritionally inferior and create far more of a negative environmental impact than merely pasturing dairy cows will ever involve.

There was some research carried out a few years back which revealed that consumers would be entirely happy, given the quality of the product they were getting, to pay another five pence a litre for their milk as long as the extra cash was passed back to farmers.

The plan was immediately scotched by the supermarkets which tried to pretend it wasn’t as simple an operation as merely passing five pence back through the supply chain and that it would be an impossibly complex system to administer. In other words, there wasn’t anything in it for them.

I shall keep a close eye on the adjudicator’s performance and if I detect the merest suggestion that this is just a bit of window-dressing to appease the farming community you will be hearing from me.

Yours ever

Ian

> The current malaise stems back to the ill thought-out decision to scrap the old Milk Marketing Board, believes Ian Liddell-Grainger