Good news at last for dairy farmers
The UK's largest dairy firm has reassured farmers that the financial crisis which led to it delaying a £10 million payment earlier this month is over.
First Milk, a co-operative owned by British farmers, told members at its annual meeting that it would not have to make any further two-week payment deferrals to its 1,200 farmers.
However, its chairman and Conservative MP Sir Jim Paice said falling prices led to the firm posting a £12.1 million loss in the six months to September 30.
First Milk said butter powder prices have fallen by 21p per litre over the last year, while mild cheddar and curd prices slumped by up to 40 per cent in the same period.
The group pays farmers around 21p per litre for milk, but industry prices were as high as 35p per litre per last year.
It added that over the last year the firm's farmers produced 100 million litres more milk than expected.
The business normally produces around 1.2 billion litres a year.
First Milk said the two-week delay raised around £10 million, which it used to plug a shortfall in its accounts.
But Sir Jim said that these measures meant First Milk will not have to come back to its members for cash.
He said: "Barring something completely out of the ordinary, I am absolutely certain this puts us right and I will not be coming back to you again for more money."
Meurig Raymond, head of the National Farmers' Union, earlier criticised the timing of First Milk's decision, stressing that dairy farmers are ''already under huge financial pressure''.
He said some farmers are now receiving just 20p per litre for milk, the lowest price since 2007, as milk becomes cheaper than mineral water in some stores.
