Newspaper article The Journal (Newcastle, England)

Columnist

Newspaper article The Journal (Newcastle, England)

Columnist

Article excerpt

Byline: PAUL BRANNEN

THE price farmers pay for milk has fallen by 25% over the past year, and according to milk farmers the so-called price-war between major supermarket retailers is to blame. The past week has seen a surge in direct action by the farmers and campaign groups tired of seeing dairy farms exploited in a fast accelerating race to the bottom.

The price of milk has always been a contentious issue - from accusations that our national politicians are out of touch for not knowing how much it costs to buy a pint of the stuff, to milk becoming a key target for price slashes as retailers vie to provide consumers with ever more bang for their buck.

The depreciation of milk prices is unsustainable for farmers struggling to make ends meet in a market that pays several pence less per litre of milk than it costs to produce.

And the casualties of this price war continue to mount: in the past year, nine dairy farms have been forced to close per week in England and Wales. The National Farmers Union (NFU) has declared a 'state of emergency' for farmers, estimating that around 60 dairy farms left the industry in December 2014 alone.

Dairy industry experts agree that 30p per litre is the absolute minimum required by farmers so that they don't operate at a loss. While some of the best known big brands have established agreements that guarantee the price paid for milk, this only covers around 14% of milk sold for home consumption, with products such as cheese and yoghurt mostly exempt.

Morrisons, Aldi, Lidl and Asda have been targeted in particular due to their failure to pay a higher price for milk that is more closely linked to the cost of production. The current average price paid to farmers is 23.66p per litre.

Following intense pressure this week, Aldi and Asda announced that they would pay a minimum of 28p per litre. Morrisons will pay 26p and is to launch a new brand titled 'Milk For Farmers', which will pay a 10p premium directly to dairy farmers. Though this is an improvement, it is clear that this does not go far enough.

In their defence, supermarkets' claim that the fall in milk prices reflects a much bigger problem - that of declining commodity prices across the globe and an oversupply in Europe. …

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