Organic milk price must increase to boost confidence and maximise output

The Organic Milk Suppliers Cooperative (OMSCo) is warning the industry that higher organic milk production costs must be recovered from the market, as reduced farm profitability risks damaging further supply increases. OMSCo believes continued expansion on UK farms is crucial to help ease the existing short supply, but this cannot be realised without adequate financial support. An immediate price increase is needed to bolster confidence as farmers make key production decisions for the next 12 months.

Production costs have escalated dramatically over the past year, with rising fuel prices impacting farm margins and poor growing conditions reducing yields. New organic feed standards have also increased feed prices, and lower yields this year mean organic farmers will be more reliant on bought in feed. Cost increases are now at a level that should be reflected in the price paid for raw organic milk, says OMSCo.

OMSCo's Sales & Marketing Director, Richard Hampton, comments, "Improved farm gate returns have generated a very big increase in UK output this year. This has helped meet consumer demand. However, demand continues to increase and the UK now has to import some of its requirements. New suppliers will only come on stream in two to three years and in the meantime existing organic dairy farmers need the confidence to extract every last litre of domestic production if we are to minimise these costly imports. It is therefore in the interests of buyers to pay British organic dairy farmers slightly more in order to maximise output."

OMSCo is the UK's leading and longest established organic dairy cooperative uniquely focused on the production and supply of organic milk. With nationwide membership, OMSCo now supplies the majority of organic milk produced in this country from milk fields offering the most cost effective collection. The result is the best blend of stability, efficiency and highest possible farm gate returns. OMSCo is dedicated to building a sustainable long term organic milk market in the UK – to the benefit of farmers, processors and consumers.