The NFU is being urged to publish a five-year price performance record of milk buyers ahead of what could be a surge in producers seeking new contracts when market conditions improve.
The Wales-based agricultural supply co-operative, Cardiganshire and Carmarthenshire Farmers, fears that farmers’ decisions will be influenced by immediate pricing so its general manager wants the union to intervene.
Keith Gosney has written to both NFU national president, Meurig Raymond, and NFU Cymru president, Stephen James, asking for their help.
The issue of milk contracts and pricing was raised during a series of on-farm workshops put on for the co-operative’s dairy farmer customers.
In his letter, Mr Gosney says many farmers had difficulty in understanding the full implications of their contracts.
He believes that as and when milk prices improve there could well be a frenzy of milk producers looking to change supplier, with many being influenced by purchasers’ immediate pricing rather than looking at their pricing history.
“That being the case, we feel the NFU could help by publishing, in six-month averages, the performance of the main milk buyers over the past five years,” he says.
“Farmers could then make an informed judgement of the likely ability of the buyer to deliver a consistent price.
“Many dairy farmers also struggle to fully understand the terms of their milk contracts, often no more than an undertaking to purchase, with pricing and clauses regarding hygiene and constituents variable at the purchaser’s option, with no discussion,” adds the letter.
“We feel the NFU legal team could go through the main milk buyers’ contracts and highlight online to members the pitfalls of the various contracts and the things to look out for when changing suppliers.”
In response, Stephen James said that NFU Cymru would consider the suggestions while pointing out that existing information on milk contracts was already available from the NFU and AHDB.
The challenge, he admitted, was getting farmers to access this information.
With some of the biggest milk price differentials ever experienced, farmers should indeed not be swayed by the headline price.
“As dairy farmers we can be a bit blinkered and not look beyond that extra 1p or 2p we are being offered.
“Salesmen are very clever and will rubbish everything else, but it has never been more important to look at the historical price performance of that company.”