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NFU Cymru call on milk processors to maximise dairy returns

NFU Cymru has called on all milk processors to stop dragging their feet and maximise the return to dairy farmers as returns continue to be well below the cost of production.

While the market outlook is now much improved and with significant positive moves in recent weeks, the union’s milk board is adamant that much more money should now be coming back to producers.

 

“The gap between most producer prices and commodity prices is now quite significant," according to board chairman, Aled Jones.

 

"All the price indicators point towards a milk price of 25ppl if not more, yet the reality for most farmers is that milk prices are still around 20ppl.”

 

Prices

 

“Global prices are continually moving upwards and the last GDT auction saw the third consecutive increase.

 

"The AMPE and MCVE price indicators have moved dramatically upwards and are now 26ppl and 28ppl respectively for August 2016. Yet the farm-gate price remains around 20ppl.

 

“This all points to the conclusion that processors are very slow to respond to market improvements,” he added.

 

“When the market takes a downturn, farm-gate prices respond immediately and processors reduce their price overnight.

 

Reaction

 

“We need to see a similar reaction when the market turns upwards and farming businesses need to see the benefit in their farm-gate prices.

 

“Processors need to genuinely reflect on the pressures that milk producers are under.

 

"We hear platitudes that processors and end users have sympathy for producers’ plight and much of this will be genuine, but the speed in reflecting positive market increase in value is simply not quick enough, particularly in the current exceptional circumstances.

 

Consequences

 

“Actions speak much louder than words and we simply ask the supply chain to seriously and genuinely consider the long-term damage and consequences of not delivering much more back to primary producers.

 

“We expect farmers to see a fair share of any improvements in markets returned to their own balance sheets - not being held back higher up the supply chain.”

 


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