April 17, 2013

 

 

About 85% of the UK milk market, composing of various dairy companies, has signed up the voluntary dairy code of practice.

 

The voluntary code, announced at the height of last summer's SOS dairy protests, lays out certain conditions in milk contracts intended to give farmers a better deal in the marketplace.

 

Robert Newberry, chief dairy adviser of National Farmers Union (NFU), told a recent NFU dairy producer summit, in Warwickshire, he was 'happy' with the response to the code, despite some concerns that some of the big companies have not yet adopted the code in full.

 

He said, "The big guys are committed in a way where they cannot back out now. If there is a bit of cherry picking going on, that is something we can work on. But they are in and they are signed up to it."

 

He said the greatest resistance was coming from some of 'big middle ground liquid processors' who 'do not want to know and are going nowhere near it'. Some of the smaller cheese companies have said they would like to embrace the code but are finding it difficult to do so, he added.

 

He said farmers have been benefiting on the elements of the code, notably the one month notice period for price cuts, since last summer. More recently farmers have been taking advantage of the clause enabling them to give three months' notice to stop supplying dairy company after a price change they disagree with, he said.

 

"We are making good progress and the key now is to keep working with the dairy companies and to keep looking at the code to ensure it works as well as possible," he said.

 

But Farmers For Action (FFA) leader David Handley accused some of the big UK processors of 'playing games' with farmers by cherry picking only the parts of the code they wanted. He questioned whether it was time for Government to intervene, as Ministers had said they would if the code was not fully implemented.

 

The meeting also discussed the opportunity now available in England for groups of dairy farmers to come together to form producer organisations (PO) to boost their power in the marketplace.

 

Newberry said some farmers already formed into groups to supply milk have confirmed they will be applying for PO status. He said he was unaware at this stage farmers coming together to form POs from scratch.

 

Some farmers at the meeting appeared uncertain of the benefits of POs when balanced against the 'hurdles in place' when it comes to forming them, such as the requirement for a minimum of 10 farmers.

 

Newberry said he expected interest in POs to grow once a few are up and running so farmers can see more clearly how they work and the potential opportunities they can bring.