Milk price cuts are ‘disaster’ for farmers (From Knutsford Guardian)

Milk price cuts are ‘disaster’ for farmers

2:40pm Friday 13th July 2012 in News By David Morgan

DAIRY farms in the Knutsford area could be facing a bleak future due to a crisis in milk prices.

The National Farmers’ Union (NFU) says that two price cuts since June for the milk farmers produce is crippling the industry.

Many farmers are being paid less for milk than it costs to produce – and it is threatening to put them out of business. Production costs for milk are around 30p per litre. But price reductions by Robert Wiseman Dairies, Arla Foods, Dairy Crest and First Milk, which will take effect on August 1, mean some farmers will be paid less than 25p per litre.

Tony Garnett, of Clay Bank Farm, Allostock, said he is fortunate to have an arrangement with Sainsburys to supply the supermarket directly, which protects his production costs.

But he told the Guardian he feels sympathy for everyone affected.

The former NFU county chairman said: “I’m not pleased they’re having a price cut. It’s a disaster. I think it’s not sustainable for people to be paid less for milk than it costs to produce it. It doesn’t add up at all.”

It is the second round of cuts since June, with milk companies blaming a collapse in the value of cream.

A spokesman for Robert Wiseman said: “The challenge we’re faced with is that if the industry doesn’t have that income then it’s not in a position to pay that to farmers. That’s the reality of the situation.”

Mike Gorton, NFU’s north west dairy board chairman, described it as the ‘systematic dismantling’ of the UK’s dairy industry. More than 550 farmers turned up at a meeting organised by the National Farmers’ Union (NFU) last week to discuss the crisis.

Robert Sheasby, NFU north west director, added: “It’s the difference for farmers of being able to pay the bills or not, invest in the business or not, have a secure future or not. Dairy is at a crisis point and farmers are taking a battering from those passing their losses on.”

The north west has traditionally been a dairy stronghold, but between 2009 and 2010 the number of dairy farms dropped from 1,913 to 1,841.

The Guardian approached Tatton MP George Osborne but he did not wish to comment.

l An emergency meeting of the NFU is being held tonight, Wednesday, at Haydock Park Race Course at 7.30pm.