Freshways producers have been threatened with a substantial price cut for non-compliance with the current A/B pricing structure, it has emerged.
Alan Smith, Freshways farmer representative, said producers had not been paid since March 28 and have been told they will not receive anything until June 12.
Last month Freshways managing director Bali Nijjar introduced an A/B pricing structure, which saw farmers receive 23.4ppl for 60 per cent of their milk and the remainder 40 per cent at 10.14ppl for April, deeming it the ‘fairest way to resolve issues created by Covid-19’.
Mr Smith said: “The processor has threatened to dock the A litre price substantially by June 1 for producers who do not sign up to the current A/B pricing structure. I do not know how they get away with it.”
Mr Smith criticised the NFU, AHDB and Red Tractor for their lack of support.
NFU dairy board chairman Michael Oakes said the union was supporting Freshways producers in a number of ways, including ’offering thousands of pounds to help with legal and contractual issues through its Legal Assistance Scheme’.
Paul Flannagan, AHDB dairy strategy director, added: “AHDB dairy has stepped up in a number of ways, including working with Defra, the devolved administrations, industry and others to produce the evidence to help inform decision-making around the introduction of the Government’s hardship fund.
“In addition, through a collaboration with industry, Defra and ourselves, we have collectively funded a £1 million marketing campaign to promote delicious, nutritious dairy products,” he said.
But Mr Smith labelled the Government’s £10,000 hardship fund a ‘kick in the teeth’ and said the campaign to encourage people to drink more milk was futile, since people already drank milk regularly.
“A better use of that money would have been to directly support producers impacted by the severe milk market turmoil and I have stopped paying my levy with immediate effect,” he said.
Freshways was approached for comment.