05 Aug 2015 --- Dairies in the UK have launched strong protests against supermarkets that they say are paying them so little for their milk that it is no longer viable to produce it. Farmers have staged protests in supermarkets, taking all the milk off the shelves and, in many cases, giving it away to shoppers to illustrate how little they are being paid.
Farmers say that it costs around 32p (€0.46) to produce one litre of milk, while they are being paid around £0.23 (€0.33) by supermarkets for one litre. Many dairies are going out of business as a result of the squeeze on prices. The price that farmers are paid for their milk is reported to have dropped by more than 25% since the same time in 2014.
Retailers, however, blame the crisis in dairy pricing on the global market, which is under tremendous strain. They say that it is not a local UK issue, but prices are low due to a global surplus of milk, coupled with lower-than-expected demand from China, which promised to be a bigger market in 2015. They also blame the Russian import ban on EU goods, which was put into place in August 2014 and will continue until at least Spring 2016.
A Sainsbury's supermarket spokesman told the BBC: "Our retail price is not related to the price we pay our farmers. Our milk prices are competitive for our customers, while also paying our dedicated dairy farmers a fair price that protects them against volatile markets."
Asda said the price that farmers get is set independently and there is no link between retail prices and farm gate prices.
Vice chairman of the National Farmers Union dairy board, Michael Oakes, said: “It’s never been this bad. The price I’m on is 24p (€0.34) per litre, and that’s not bad for the UK. I have neighbours who will be on 18 (€0.26). And my cost of production is 28p (€0.40) per litre. We’re working harder and longer but there’s still no margin in it and we question how long we are going to be able to carry on.”
The UK farming unions are to stage an urgent summit to discuss problems facing the industry and particularly the crisis in the livestock and dairy sectors, where many farmers are facing financial devastation.
This follows falling prices which has seen many farmers getting paid less than the cost of production. The summit will be held in London on Monday August 10.
NFU President Meurig Raymond said: “The situation many of our members are experiencing has become a crisis. In dairy, many milk producers have seen price cut after price cut. It’s simply not sustainable for any farmer to continue to produce milk if they’re selling it at a loss. The plight of many farmers has become desperately serious and with no sign that things will improve, we really need urgent action from retailers, the food service sector and processors to show commitment to British dairy farmers. I also want to see government agencies doing more to support the public procurement of British food.
British dairy organisation AHDB Dairy said the average UK farm gate price was 24.06p (€0.34) per litre in May, a decrease of a quarter over 12 months.
