NFU welcomes ASDA milk deal

NFU CYMRU WELCOMES ASDA MILK DEAL

The NFU has welcomed the announcement by Asda of their move to a dedicated supply chain for liquid milk.

The arrangements for the new supply are expected to be in place by late 2004 and Asda's needs will be met by dairy farmers supplying Arla Foods.

Asda set out three criteria for the delivery of the new business: transparent relationships, segregated milk supply and identified farmer suppliers. The resulting deal was created from a long and detailed consultation with the direct involvement of farmer groups.

NFU Cymru's Vice President and Carmarthenshire dairy farmer, Dai Davies said, "The new arrangements are a positive step in connecting farmers with the needs of the marketplace, which in itself is one of the key areas of CAP Reform.

"This is an ambitious step involving a significant volume of raw milk. We hope that Asda can build on this by offering new and innovative outlets for cream and other fresh products often considered as by-products of the milk industry.

"In the longer term, the dairy industry has to ensure that the new arrangements allow farmers to extract greater profitability from the supply chain and negotiate fairly with their customers."