Good Evans: There are those with no contract for coming year
I think I may have told some of you this story about 20 years ago. I don’t apologise for repeating it because it is probably even more relevant today than when I first told it.
Shortly after the deregulation of the dairy industry, when the Milk Marketing Board finished (1994 I think), I met a man who could remember how difficult it was to be a dairy farmer before the advent of the MMB.
His family farmed in the Midlands and their milk went to Cadbury. I’m not having a go at Cadbury, that just happens to be where their milk went. They hadn’t been paid for any milk for four months and were suffering accordingly.
But his grandfather was a resourceful man and one day he decided he would make the journey to Bourneville to try to get the money. It was a huge event in the family’s life. The man could still remember the effort his Gran put into polishing Granddad’s leather gaiters and how all the family went with him in the pony and trap to take him to catch the train.
Granddad gets back late that night on the last train. His journey has been worthwhile, up to a point. They haven’t paid him the four months money they owed him, but they had given him two months, although the price was depressingly low. Out of the shambles that existed at the time was born those marketing boards.
Politicians finally recognised that milk was probably the most important staple in the nation’s diet and that it had to be produced in a manner which secured that production.
Comparisons between where we find ourselves today and the 1930s are not quite the same. But not getting a sustainable price for our milk comes a very close second to not getting paid at all.
But there are fellow dairy farmers out there without a contract for their milk for the next milk year. Those dairy farmers who moved to milk brokers on a rising market took a chance – that makes them chancers. There was nothing long term in their vision, a couple of second-hand milk tankers and a portable cabin do not constitute a forward marketing strategy.
Their milk will be picked up. It will probably be picked up on a daily basis. That basis will be “we’ll pick up tomorrow’s milk if we can sell today’s”.
There will be a lot of unknowns involved, but the only sure thing is that the price will be awful. It will be what they call distressed milk.
There’s been distressed milk, milk that hasn’t got a home, lots of times in the past but it has always been a problem for largescale milk buyers and it has often ended up in the Irish Republic. Now we are going to see distressed milk on farm.
There’s no comfort to be had in this for any of us. Don’t think for a minute the dairy sector buyers at the major supermarkets won’t notice there is cheap milk sloshing about in the system. They spend most of their time wondering what the discounters are up to and the pressure on them to turn a profit will be huge. Low milk prices for some is no good for any of us, low prices elsewhere could easily drag the whole market down. Remember that 2015 was to be the year when the industry took a brave leap forward in to a future that was unfettered by quotas. Well we have taken a leap forward, in to the fire.
The advent of quotas was a very traumatic time for all of us. As an industry we reacted badly. People were selling heifers that were bagging up to calve in the cull cow section, and some heifers were so close to calving they calved in the pens before they could go through the ring. If you went to market, someone would whisper to you “there were a 1000 cows in Gloucester last week”. Go around the corner and someone else would say “I was in Gloucester last week and there were 2000 cows there”. We didn’t handle the advent of quotas very well from the start. And then we spent about 15 years trying to lease or buy some more. The year quotas were introduced was traumatic but this year looks to be equally horrendous.
So what’s to be done about it? Well it’s only a snowflake in a blizzard, but we could stop buying cattle from abroad for a start. I’ve read the adverts. ‘Go abroad to buy some heifers’. Going abroad to buy some heifers is not without its attractions, especially if you are outside on a cold wet day changing a mucky front wheel bearing on a mucky scraper tractor. In the first half of 2014, 650 cows and heifers came here from Ireland, up 44%. We used to worry about milk coming here from Eire after quotas finished in April. Well a lot of it is already here and we’re doing the milking.
If you fancy a trip abroad in winter give me a ring. I could easily organise three or four trips to Benidorm for about £150. You wouldn’t have the expense of buying heifers, and you’d enjoy yourself. I could even take you to see Sticky Vicky