Clear steer and commitment required

"The phrase price takers rather than price setters had never been truer than for today's dairy farmers. Yet, when dairy farmers talk of coming together to increase their market clout to try to help themselves, this is immediately frowned upon by the Office of Fair Trading as some sort of price fixing arrangement for milk.", said John Gwynant Hughes, NFU Cymru Chairman for Mid Gwynedd.

John Gwynant Hughes, who farms in Criccieth, was addressing a recent meeting of NFU Cymru members, held at Hendy, Caernarfon - the dairy farm of NFU Cymru member Aled Jones. Also present at the meeting were NFU Cymru President, Dai Davies, and Plaid Cymru MP for Caernarfon, Hywel Williams.

Dai Davies said, "Dairy producer prices cannot be squeezed any further. In fact there is every justification for an increase in prices to producers. Although the Government does not have a direct influence on price, they can do much more to help an industry that is diminishing by the day in terms of producer numbers.

"NFU Cymru is currently conducting a survey of the increased costs of milk production. As a typical example, some producers are facing a 32% hike in electricity costs. With some savage increases and continued low milk prices, more and more businesses will say enough is enough. Where will that leave the processors and retailers who depend on a secure supply of milk all year around? They must look further than just their own profit margins and shareholder dividends."

Mr Davies added, "There are rumblings from DEFRA about the so called Celtic fringe factor on Single Farm Payments. There are indicators that in 2008, they would wish Wales to switch from historically based single farm payments to the regional payment system operational in England.

"To that we say 'hands off' and let Wales through the Welsh Assembly Government deal with its own matters. However, we need to ensure that Welsh farmers whose payments are modulated are not disadvantaged and have parity in the match funding of these modulated funds from the UK Treasury."

Hywel Williams MP said, "There is clearly a need for better protocol between the Assembly and Westminster Government. Responsibilities need to be better defined and a transparent system of identifying the allocation of funds from the UK Treasury to Wales needs to be put in place."