September 8, 2006

Scotland's dairy farmers demand increase in milk prices
 

NFU Scotland Thursday (Sep 7) has demanded a milk price rise from all major milk processors.

Milk processors said the main factor in setting the prices paid to farmers is the demand for products such as milk powder, cream and butter.

However, now that prices for these products have risen substantially, some to a six-year high, the processors have not offered a corresponding increase in the prices paid for milk, said Jim McLaren, NFU Scotland Vice-President.

Milk buyers earlier reduced farmgate milk prices expecting poorer cream, butter and powder prices. However, the drop in prices has failed to materialise.

Instead, prices have gone up and processors are profiting from it but not dairy farmers, McLaren charged.

Processor Robert Wiseman Dairies, assured its producers, after announcing a price drop in August that they would monitor cream values using Milk Development Council (MDC) figures as a benchmark.

Yet when MDC figures showed cream prices increased in the past two months, Wiseman Dairies did not increase their offer prices. Arla is also among those accused of similar measures.

A brighter future for milk and dairy products in the UK would only happen if processors recognise the huge increase in the costs faced at farm level and allow for investment in the future, McLaren said.

Given current market conditions, a significant price increase to dairy farmers is totally justified, McLaren said.