Rural Diaries – country life, the countryside and rural issues

Posted by Sally on June 5th, 2009 in British Food, Farming Issues

Another sad day for British farming as the Dairy Farmers of Britain call in the receivers.

The news of receivers being called in happened on the same day the Farmers Weekly reported that farming industry leaders called for retailers to pay a fair price for milk.

I know hindsight is a wonderful thing but the concerns over British milk prices is no new story, just have a look at this article from 1995 discussing the real reason the milkman’s time is up.

Note in the article the comments about the control supermarkets had on prices then, so what was done to protect British farming and guarantee fair prices? Well the strangle hold supermarkets still have on the farming industry answers that question … bugger all.

The Dairy Farmers of Britain (DFoB) is a co-operative with over 1800 members, 2200 staff and responsible for 10 percent of Britains milk production.

They act as a broker between dairy farm members and supermarkets, ensuring a market for their members and the size of the organisation allowed them to negiotiate slightly better prices paid by supermarkets.

However, they lost a large contract with the Co-Op supermarket chain, a couple of their large dairies closed and they struggled to pay dairy farmers.

Dairy farmers, like most small farmers, have suffered from the strangle hold the four large supermarket chains have on the buyers market, keeping prices at levels too low to sustain British farming while recording huge profit increases themselves.

Even though Britain has seen the highest food price rises in Europe these profits have not proportionally been passed from the supermarket chains to food producers.

My heart really goes out to Dairy farm members and the staff at the DFoB whose jobs are at risk in a very difficult time economically .. although not for large supermarket chains.

The members of DFoB may not only lose out on a market for their produce and last months cheque but they also had to pay a lump sum, based on the size of their herd, to become a member of the DFoB.

FWi reported milk quota broker agent Ian Potter as saying “farmer suppliers faced losing an estimated £14,000 each in unpaid milk on top of an average farmer investment of £25,000 which has already been lost.”

A staggering 52 million pounds was invested by members and the DFoB was only formed in 2002.

The contracts that tied Dairy Farmers to DFoB meant their hands were tied and they could not leave even though they knew the situation was getting worse.

The receivership means dairy farmers are now able to jump ship, as there is very little chance of the DFoB taking legal action for breaking the contract (seek legal advise if you are a member).

This is simply the end for some small dairy farmers, they have struggled on for years but this is the last straw and it’s finally sinking in that if we demand higher prices from supermarkets they will simply buy in French milk and British consumers simply don’t care as long as it remains cheap.

I know that the dairy herd at one small farm in Yorkshire, a member of the BFoB, is being collected on Tuesday, they just can’t make ends meet.

I told you a couple of weeks ago about the tragic farming accident that left a pregnant widow and her small children, in my post farming safety message not getting through .. guess what the widows dairy farm is a member of?

A couple of local farmers have been going every day to milk their herd to keep the farm running during this tragic time but I doubt any of us can imagine what this blow on top of everything else means for the widow .. certainly it’s the end of the farm.

That is the human face of this receivership, not the statistics and possible job losses reported by the press but the real impact this will have.

Some farmers will lose their livelihood, herds they have carefully bred during a lifetime of farming and their homes. I am trying not to think how many more farming divorces this will create as money tensions come between husbands and wives.

The NFU have a detailed question and answer document on their website for NFU members who will be affected by this move. The document includes information from the receivers and on the legal issues for DFoB members, they are updating it as and when new information arrives.

NFU members can access the document here.