The agricultural industry makes a significant contribution to the Welsh economy and its employees deserve to be treated with fairness and respect. Yet unless urgent action is taken to tackle the cut in the cost of milk, the Welsh dairy industry will face a crisis that will drive farmers out of business and leave consumers facing a rise in shelf prices.
Plaid having long campaigned for a Supermarket Ombudsman welcomed the Chancellor's announcement that a Milk and Groceries Ombudsman would be established following the recent Budget. Yet many people (and Plaid included) have real concerns that the proposals will fail to give the Ombudsman any real teeth to ensure a good deal for farmers.
The proposed cut of two pence per litre of milk due to be introduced in August would leave farmers at a loss, paying more to produce milk than to sell it. This is wholly unsustainable and threatens one of the Welsh economy's most valuable assets. Any Supermarket of Milk and Groceries Ombudsman needs to take a serious look at the dairy industry and put itself squarely on the side of farmers against supermarkets and their shareholders.
Before the last Westminster General election in May 2010 there was much talk (even from the Conservatives) of the need for a Supermarket (and even a Milk) Ombudsman, when there was a pressing need for votes, since then there has been relative silence from Westminster, save for the Chancellors budget mutterings. The Supermarkets having purchased their tame politicos in the Westminster village (well before the Political Parties and Referendum Act 2000 came in) would be quite happy with a weak Ombudsman, who’s pronouncements they can ignore continue to aggressively pursue ever greater shares of the profit with minimal regulation.
At present one litre carton of full-fat, non-organic milk can cost around 65p (01.02.2012 figures). From this a farmer got between 21p and 28p. Production costs come in at around 28p. No wonder that over the last ten years two thirds of dairy farmers in England and Wales have gone out of business, that it is estimated works out as one dairy farmer leaving the industry every day.
The situation has not got any easier for the farmers or the consumers, especially as we now have to factor in increased transport and production (fuel) costs. When it comes to a fair deal the current milk prices make grim reading as widespread promotions continue to be offered on liquid milk by the usual suspects. Supermarkets are also widely offering branded and organic milk on promotion – guess who takes the hit for cost cutting – the farmers!
The most recent DEFRA figures, show that the average UK farmgate price stood at 26.98ppl in May 2012 (it was 29.27ppl at the end of January 2012 and 29.38ppl in November 2011). The May figure showed a 0.85ppl (3.0%) decrease on the April average price. Annual comparisons show a 0.6ppl (2.3%) increase year on year. The GB average price was 27.97ppl in May, a 0.49ppl (1.7%) decrease on the previous month and an increase of 1.46ppl (5.5%) compared with May 2011. The Northern Ireland (NI) average for April fell to 21.99ppl, a decrease of 3.00ppl (12.0%) compared with April and 3.74ppl (14.5%) less than the previous year.
We are in the process of losing a critical mass of milk suppliers (something the NFU is only too aware of) and we have reached the point where UK farmers are no longer in a position where they can supply the UK's “core milk requirement” around 13 billion litres per year (2010 figures). In 2009 / 2010 year there was a 15 percent drop in UK Milk prices. If you look at the wholesale prices e.g. Butter, Cheese, Cream, etc the situation is no better.
Over the last 10 years that Supermarkets’ margins (e.g. the amount of the price they take) on milk have doubled. Now with a trend for both the processor and retailer to be the same, we have a situation where they take over three quarters of the price of a pint. We have now reached the situation where in a land once renowned for Dairy farming and with cheap milk, we are becoming a net importer of milk.
We (as customers and consumers ) also some of the blame because we let this happen, if we want quality milk and dairy products (that are produced in these islands from UK milk) then we will have to change the way we buy, if we do that then out farmers will get a better deal. There is little point in hoping that the Con Dem Government (or a future New Labour one) will get its act together because they just won't.
Showing posts with label Welsh Dairy Farmers. Show all posts
Showing posts with label Welsh Dairy Farmers. Show all posts
Wednesday, 18 July 2012
Friday, 17 February 2012
THE PRICE OF A PINT (PART 2)
Before the last Westminster General election in May 2010 there was much talk (even from the Conservatives) of the need for a Supermarket (and even a Milk) Ombudsman, and a pressing need for votes, since then there has been an effective silence from Westminster. One view from this side of the bridge that may be increasingly shared is that the Supermarkets bought their tame politicos in the Westminster village (well before the Political Parties and Referendum Act 2000 came in) so they can continue to aggressively pursue ever greater shares of the profit with minimal regulation.
At present one litre carton of full-fat, non-organic milk can cost around 65p (01.02.2012 figures). From this a farmer got between 21p and 28p. Production costs come in at around 28p. Over the last ten years two thirds of dairy farmers in England and Wales have gone out of business, that it is estimated works out as one dairy farmer leaving the industry every day. The situation has not got any easier for the farmers or the consumers, especially as we now have to factor in increased transport and production (fuel) costs.
When it comes to a fair deal the current milk prices make grim reading as the shelf price for four pints has remained largely static at around £1.27 for 4 pints since February 2011, and widespread promotions continue to be offered on liquid milk in May with Sainsbury’s and Asda offering 2 x 4 pints for £2.00 and Tesco offering 3 x 4 pints for £3.00. Supermarkets are also widely offering branded and organic milk on promotion – guess who takes the hit for cost cutting – the farmers!
DEFRA's annual data showed that the average UK farmgate price (Defra, Dairyco.net) stood at 29.27ppl at the end of January 2012. The GB average price was 29.38ppl in November 2011, 0.29ppl (1.0%) higher than the previous month and up 3.44ppl (13.3%) compared with November 2010. The Northern Ireland (NI) average for November was up slightly, to 28.76ppl, an increase of 0.20ppl (0.7%) compared with October and 1.07ppl (3.9%) more than the previous year.
What's happening is that we are in the process of losing a critical mass of milk suppliers (something the NFU is only too aware of) and UK farmers are no longer in a position where they can supply the UK's “core milk requirement” which is around some 13 billion litres per year (2010 figures). In 2009 / 2010 year there was a 15 percent drop in UK Milk prices. It is no coincidence that over the last 10 years that Supermarkets’ margins (e.g. the amount of the price they take) on milk have doubled.
Now with a trend for both the processor and retailer to be the same, we have a situation where they take over three quarters of the price of a pint. We have now reached the situation where in a land renowned for Dairy farming and where even though the price of our milk is cheap, we are now become a net importer of milk.
As early as 1914 the UK Government recognised that milk was important for nutrition in children, it helped prevent rickets, and provided vitamins. And so the first government attempts to regulate milks supply and quality came about. Pasteurization came in to kill of certain bacteria. We now have low fat milk, slimmed milk, semi skimmed milk, etc – one thing to think about is that full fat milk is only 4 percent fat, low fat milk being 2 percent (or less) and that milk is about 95 percent water anyway.
The banks (pre Mrs T) fell over themselves throwing credit at our farmers to encourage them to (as per Government and the EU policy) to expand their production. Mrs T’s particular brand of Conservatism was never that interested in farming, they were far more enamoured by the iffy money men in the City, so did nothing to prevent the imposition of Milk quotas (or their consequences) the bad times had begun for our Dairy farmers and oddly enough the banks stopped calling with offers of cheap credit.
As consumers we also have to take a share of the blame because we allowed all of these things to happen, if we want quality milk and dairy products (that are produced in these islands from UK milk) then we will have to change the way we buy, if we do that then out farmers will get a better deal. I think that there is little point in hoping that the Con Dem Government will get its act together, wake up and pull the fat (or the milk) out of the fire...because they won't.
At present one litre carton of full-fat, non-organic milk can cost around 65p (01.02.2012 figures). From this a farmer got between 21p and 28p. Production costs come in at around 28p. Over the last ten years two thirds of dairy farmers in England and Wales have gone out of business, that it is estimated works out as one dairy farmer leaving the industry every day. The situation has not got any easier for the farmers or the consumers, especially as we now have to factor in increased transport and production (fuel) costs.
When it comes to a fair deal the current milk prices make grim reading as the shelf price for four pints has remained largely static at around £1.27 for 4 pints since February 2011, and widespread promotions continue to be offered on liquid milk in May with Sainsbury’s and Asda offering 2 x 4 pints for £2.00 and Tesco offering 3 x 4 pints for £3.00. Supermarkets are also widely offering branded and organic milk on promotion – guess who takes the hit for cost cutting – the farmers!
DEFRA's annual data showed that the average UK farmgate price (Defra, Dairyco.net) stood at 29.27ppl at the end of January 2012. The GB average price was 29.38ppl in November 2011, 0.29ppl (1.0%) higher than the previous month and up 3.44ppl (13.3%) compared with November 2010. The Northern Ireland (NI) average for November was up slightly, to 28.76ppl, an increase of 0.20ppl (0.7%) compared with October and 1.07ppl (3.9%) more than the previous year.
What's happening is that we are in the process of losing a critical mass of milk suppliers (something the NFU is only too aware of) and UK farmers are no longer in a position where they can supply the UK's “core milk requirement” which is around some 13 billion litres per year (2010 figures). In 2009 / 2010 year there was a 15 percent drop in UK Milk prices. It is no coincidence that over the last 10 years that Supermarkets’ margins (e.g. the amount of the price they take) on milk have doubled.
Now with a trend for both the processor and retailer to be the same, we have a situation where they take over three quarters of the price of a pint. We have now reached the situation where in a land renowned for Dairy farming and where even though the price of our milk is cheap, we are now become a net importer of milk.
As early as 1914 the UK Government recognised that milk was important for nutrition in children, it helped prevent rickets, and provided vitamins. And so the first government attempts to regulate milks supply and quality came about. Pasteurization came in to kill of certain bacteria. We now have low fat milk, slimmed milk, semi skimmed milk, etc – one thing to think about is that full fat milk is only 4 percent fat, low fat milk being 2 percent (or less) and that milk is about 95 percent water anyway.
The banks (pre Mrs T) fell over themselves throwing credit at our farmers to encourage them to (as per Government and the EU policy) to expand their production. Mrs T’s particular brand of Conservatism was never that interested in farming, they were far more enamoured by the iffy money men in the City, so did nothing to prevent the imposition of Milk quotas (or their consequences) the bad times had begun for our Dairy farmers and oddly enough the banks stopped calling with offers of cheap credit.
As consumers we also have to take a share of the blame because we allowed all of these things to happen, if we want quality milk and dairy products (that are produced in these islands from UK milk) then we will have to change the way we buy, if we do that then out farmers will get a better deal. I think that there is little point in hoping that the Con Dem Government will get its act together, wake up and pull the fat (or the milk) out of the fire...because they won't.
Tuesday, 13 July 2010
STILL WAITING FOR A SUPERMARKET OMBUDSMAN?
Before the election, when every prospective politician was the farmers friend (or claimed to be at least) there was much talk from the big 3 London based parties about the need for a Supermarket Ombudsman. With potential votes in the offing all of a sudden it seemed a very good idea, especially if you were a Conservative, Liberal Democrat or Labour Party candidate, to talk up the prospects of having a Supermarket Ombudsman (with real teeth) who might be capable of protecting both the consumer, the supplier and the farmer from some of the more harsher aspects of monopolistic capitalism as practised by certain supermarkets.
Now don't get me wrong a Supermarket Ombudsman is a good idea and a measure of protection for the customer, the supplier and the farmers is a good idea that has (and is) long overdue - but it does seem to have gone awfully quiet since the election. When I was clearing my spare room I came across a hastily scribbled note from 2006 (probably in preparation for a Conference speech in 2006 / 2007) which even though we are a few years down the line should give most people some food for thought:
A good and pertinent question to ask would be what do they (the Supermarkets) get for their money? or at least what are they seeking in lieu of their donations? The answer may well be a weak and watered down Supermarket Ombudsman - which is the last thing any of us needs, whether as a customer, a supplier or a farmer. Another question that needs to be asked is whatever did happen to that much vaunted pre-election idea of a Supermarket Ombudsman?
So far, not a lot...
Now don't get me wrong a Supermarket Ombudsman is a good idea and a measure of protection for the customer, the supplier and the farmers is a good idea that has (and is) long overdue - but it does seem to have gone awfully quiet since the election. When I was clearing my spare room I came across a hastily scribbled note from 2006 (probably in preparation for a Conference speech in 2006 / 2007) which even though we are a few years down the line should give most people some food for thought:
- The big '5' (in 2006) controlled almost 80% of the grocery sales in the UK
- Between 1995 and 2000 the UK lost one fifth of its local shops and local services - local post offices, local butchers, local branches of banks, grocers, etc
- The supermarkets have made and regular large donations (in cash or kind) to both New Labour, the Conservatives and other political parties.
- 54 years ago farmers received between 45 and 60% of the money that consumers spent on food.
- In 2006 it was just 7% in the UK, 3.5% int he USA and 18% in France.
- Gate prices don't make anything like a fair comparison with final Shelf price - in the UK farmers got (in 2006) something like 8 - 13% bellow the EU average gate price.
A good and pertinent question to ask would be what do they (the Supermarkets) get for their money? or at least what are they seeking in lieu of their donations? The answer may well be a weak and watered down Supermarket Ombudsman - which is the last thing any of us needs, whether as a customer, a supplier or a farmer. Another question that needs to be asked is whatever did happen to that much vaunted pre-election idea of a Supermarket Ombudsman?
So far, not a lot...
Saturday, 16 January 2010
LOCAL FOOD, LOCAL FARMERS
With an election coming, particularly in a rural constituency, everyone chasing votes will appear like magic and claim to be the farmer’s friend. Our farming communities, despite this forthcoming warm are feeling increasingly isolated and marginalized, the contempt with which the farmers used to be treated by the once New Labour Government in Westminster and until relatively recently in Cardiff Bay at least until the arrival of Elin Jones, Agriculture Minister in the Plaid driven One Wales Government , used to mirror the neglect of the important agricultural sector, which makes a significant contribution to our rural economy.
It is worth remembering that not that long ago in the 1980's it was a Tory Secretary of State who literally sat by and quietly did nothing when many of our Dairy farmers got hammered into the ground by cuts in the milk quota. Never again must any Welsh Minister fail to stand up and be counted and to fail to argue their corner on behalf of Welsh farmers. Now at least withElin Jones (AM), the Plaid One Wales Government Minister for Rural Affairs we have a minster who is not afraid to actually meet with and to stand up for our farmers and their interests - this is a refreshing change from what has gone before.
Much more of an effort to create a level playing field for our farmers and a real effort from National and Local government to secure 80% of publically procured food locally by 2015 – this could provide the first practical step towards helping Welsh farmers and other producers make the most of the new opportunities that will arise from higher public purchasing of local products.
Let’s not kid ourselves, any economic failure across the farming sector will have a massive knock on effects for dependent small businesses and suppliers across the whole rural economy, in the small towns and across the Welsh countryside itself; which is as a living landscape is a result of generations of ongoing hard work by the farming community.
The Plaid driven one Wales Government unlike previous governments in Westminster and Cardiff Bay no longer treats the agricultural sector with indifference. Most people agree that much more effort has to be made to market first class Welsh produce within Wales, within the UK and in Europe and beyond.
Now, our farmers, despite some mutterings to the contrary, are not just in the businesses of merely waiting for an annual brown envelope and cheque from Brussels but for a real opportunity to make a decent living within the agricultural sector - to do this they need a fair deal. We need to take practical steps to give Welsh farmers a fighting chance of making a real living; securing 80% of publicly procured food locally by 2015 is a realistic and practical aim.
This is something that could provide the first practical step towards helping Welsh farmers and other producers make the most of the new opportunities that will arise from higher public purchasing of local products and is something that will benefit local farmers, local businesses and the local economy.
It is worth remembering that not that long ago in the 1980's it was a Tory Secretary of State who literally sat by and quietly did nothing when many of our Dairy farmers got hammered into the ground by cuts in the milk quota. Never again must any Welsh Minister fail to stand up and be counted and to fail to argue their corner on behalf of Welsh farmers. Now at least withElin Jones (AM), the Plaid One Wales Government Minister for Rural Affairs we have a minster who is not afraid to actually meet with and to stand up for our farmers and their interests - this is a refreshing change from what has gone before.
Much more of an effort to create a level playing field for our farmers and a real effort from National and Local government to secure 80% of publically procured food locally by 2015 – this could provide the first practical step towards helping Welsh farmers and other producers make the most of the new opportunities that will arise from higher public purchasing of local products.
Let’s not kid ourselves, any economic failure across the farming sector will have a massive knock on effects for dependent small businesses and suppliers across the whole rural economy, in the small towns and across the Welsh countryside itself; which is as a living landscape is a result of generations of ongoing hard work by the farming community.
The Plaid driven one Wales Government unlike previous governments in Westminster and Cardiff Bay no longer treats the agricultural sector with indifference. Most people agree that much more effort has to be made to market first class Welsh produce within Wales, within the UK and in Europe and beyond.
Now, our farmers, despite some mutterings to the contrary, are not just in the businesses of merely waiting for an annual brown envelope and cheque from Brussels but for a real opportunity to make a decent living within the agricultural sector - to do this they need a fair deal. We need to take practical steps to give Welsh farmers a fighting chance of making a real living; securing 80% of publicly procured food locally by 2015 is a realistic and practical aim.
This is something that could provide the first practical step towards helping Welsh farmers and other producers make the most of the new opportunities that will arise from higher public purchasing of local products and is something that will benefit local farmers, local businesses and the local economy.
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