Scotland-More bad news for dairy farmers.

SCOTLAND-MORE BAD NEWS FOR DAIRY FARMERS.

There was more depressing news yesterday for Scotland’s rapidly diminishing band of dairy farmers with the announcement that Arla Foods is to cut its ex-farm price by 1p per litre from the start of May.

The move follows a reduction of 2p per litre in January.

Arla sources much of its milk from producers in Dumfries and Galloway for its state-of-the-art premises in Lockerbie, but also buys large quantities in the North of Scotland for its Claymore

creamery in Nairn. Most of the Arla milk is subsequently sold in Asda, Tesco and Morrison supermarkets.

Jimmy Mitchell, chairman of the NFU Scotland’s milk committee, said: "Dairy farmers are calling out for a period of stability so they can take stock of their businesses. This decision by Arla is deeply disappointing."

However, the real concern is that the dairy industry appears to be in an increasingly desperate situation of falling prices, fuelled by a global decline in demand. But worse may be around the corner.

Mitchell said: "The rot in prices has to stop and all parts of the chain need to take stock of the damage done at farm level. The industry is well aware that the number of producers leaving milk production is exceeding the number of farmers planning to expand their herds. Milk production in the UK is at its lowest level since the early 1970s and is likely to go lower.

"Unless processors and retailers acknowledge that farmers warrant a fair return, they will perpetuate the decline in the dairy sector when long-term prospects should be good."