Anger over 'absurd' Defra figures that claim milk price rose 10.8% last month

A farmgate milk price rise of 10.8% for February is 'absurd' according to dairy experts after Defra published the new figures in its overview.

A spokesman for Defra said the rise to 25.57p/litre was due to the inclusion of bonus payments worth 0.78p/litre.

Since the bonus payments were made to many dairy farmers during the month for annual production, it does not represent how much GB farmers received on average for their February milk production (i.e. the value of each litre of milk produced).

Arla’s 13th payment was one of the main bonuses attributed to February’s milk payments in Defra’s calculation, although it actually applied to all volumes delivered in 2015.

AHDB estimates this has inflated Defra’s figure for February by between 2.50 to 2.75 pence per litre.

This would put the price, excluding retrospective bonuses, slightly below January’s figure of 23.09ppl, which is in line with how monthly prices have moved on the AHDB Dairy League Table.

But many dairy experts criticised the inclusion as it gave the impression dairy farmers were receiving good prices but most in fact faced price drops.

"This is an absurd figure," dairy analyst Chris Walkland said.

"To suggest the milk price has gone up by 10.8 per cent is a joke."

"If it is not changed then it will just mean the general media asks what dairy farmers are moaning about.

"It also allows other countries to have a distorted view of how our farmers are doing.

"They are wholly misleading and utterly nonsensical."

A spokesman for Defra said: "The increase in February’s figures reflects the inclusion of annual bonus payments made to some producers."

Farmers for Action had planned demonstrations in London at the low prices being received by farmers.

"Announcements have reached some farmers that their milk price could be 12ppl or below. This means bankruptcy in anybodies language who is a dairy producer."

AHDB Dairy said: "The problem with the Defra figure, which is based on a sample of roughly 90% of total deliveries, is that it is simply a measure of the total amount paid by processors in a month divided by the volume of milk collected in that month.

"It does not represent the average value of just the milk delivered in the month in question. On occasions when retrospective bonuses are paid, these two prices can differ significantly, as they did in February when the extra Arla payment was made."