NFU launches campaign to recover costs that threaten dairy industry

The NFU is launching a campaign today to encourage dairy farmers in England and Wales to send in invoices to boost flagging milk prices in the face of rising production costs.

NFU Dairy Board chairman Gwyn Jones said most milk producers were already operating at a loss and were in no position to absorb the extra production costs they had faced this summer, which a recent NFU/RABDF survey estimated at an extra 0.78p per litre.

He warned hundreds more dairy farmers would quit the industry if prices were not increased, ultimately putting the future of the UK dairy industry at risk.

Mr Jones said: "Hardly a week goes past without dairy farmers being told by one supplier or another that, with great regret, they have been forced to increase their prices because of higher raw material costs which they can no longer absorb.

"Well, now the boot has got to be on the other foot. It is time to enable milk producers to pass on their extra costs, in the same way as other people in the supply chain pass on their costs to milk producers.

"For the average dairy farmer, these latest cost increases from more expensive energy and the impact of the summer drought on feed and fodder supplies take the gap between what it costs to produce a litre of milk and the price that is paid for it to around 4ppl. That is simply not sustainable."

The NFU will be distributing thousands of standard invoices that dairy farmers can use to calculate the difference between their milk price and production costs. Once all invoices are in, the NFU will then be able to demonstrate to the supply chain just how big the gap really is across the industry.

Mr Jones said the aim was to make the process as easy and non-confrontational as possible, so as to attract the largest possible response.

"I appeal to dairy farmers throughout England and Wales to support this campaign. It has the potential to make a real impact for the better, but only if we get a huge response", he said.

"In the short-term, a substantial price increase across the board is desperately needed to stop the dairy industry bleeding to death. But our over-riding aim remains to work with processors and retailers to achieve a sustainable supply chain that delivers fair prices for good products to all of the players in it."