Dairy farmers feel like cats that got the cream

In recent months the price paid for milk to dairy farmers has turned around.

“It couldn’t have got much worse,” said one farmer who didn’t want to be identified, and the truth is that prices have increased by more than 50 per cent in the last 12 months.

That has taken the value of produce back to about the 30p per litre mark, which is close to the cost of production and means dairy farmers can make a profit.

It comes on the back of a long and exhausting downturn which has led some to turn their backs on dairy, which is often seen as more of a calling than a job.

While you’re never likely to meet a farmer who is gleefully clicking their heels at the state of their industry, the sighs of relief around Telford’s International Centre as thousands of members of the UK’s dairy industry descended for one of the biggest shows in the sector’s calendar were palpable.

Richard Yates, a former county NFU chairman with dairy cattle near Bridgnorth, said: “It’s always pleasing to get up at 5.30 in the morning when I know I’m going to make money from milking my cows today.

“It makes a heck of a lot of difference selling milk at 30p per litre compared to 16p as I have in the last 18 months.

“Everybody has a smile on their face, and as we see at this magnificent show, a number of businesses earn a revenue by supplying the dairy industry.”

He added: “It has been tough. There’s only so much tightening the belt that one can do. Many neighbouring farms have called time on milking dairy cows, which is a seven day-a-week experience for which we need to get adequate returns.”

The key for many farms has been in diversification, and adding new revenue streams which increase the value of the milk they are producing then selling.

That has often been in the form of products like cheese and ice cream, spun out from farms, which has led to a big lift in the number of local products at farmers markets and even into supermarkets.

But now the milk itself is becoming a star attraction in its own right.

“A lot of the farmers here are more positive,” said Rebecca Barningham, part of the organising team for UK Dairy Day.

“A lot have gone through consolidation and are now thinking they can start to reinvest, some are pushing herd numbers up, and some are looking at grant schemes to invest in new buildings or parlours.

“Some are also looking at diversification, and are investing in things like vending machines for milk, cheese and ice cream.

“There are more dairy farmers going into that now. They are near towns, villages or farm shops and selling milk straight off the farm or off the drive and into farm shops.

“There’s all kinds of diversification – ice cream, cheese, yoghurts, then you have some farmers that are using their farm as a showcase to engage with young children.”

Roel Driesen, from Shropshire Farm Vets at Hanwood, said he had noticed the turnaround in farmers’ fortunes.

“There is a lift at the moment because milk prices are better,” he said.

“Things feel better. For a while they were really holding back investing in the farming side.

“For example we also started a foot-trimming service and that has still grown, but when we are on a downturn they don’t really want to start doing that. Now it’s picking up again.

“Farmers are very cautious because they have been stung too many times.

“But they are tough people, they stick it out. Everybody knows that yes, you get a downturn but it comes back up again

“They do realise that now that things are slightly better that they have left things for a long time that they should have done, and that the need to sort things.”

While prices are now rebounding, farmers are naturally cautious, and the call has gone out for dairies to provide long-term security over prices.

Muller is among the dairies to have offered better prices, and has also put in place mechanisms aimed at forecasting milk production in order to prevent the market flooding and prices plummeting.

NFU president Meurig Raymond was present at the Telford event.

He said: “Prices are back to a level where most farmers are making a profit. There’s huge debt to pay off so we need that stability going forward, and most farmers agree that as long as the price has a three at the beginning of it, there’s a margin to be made.

“It’s important that dairy farming is profitable and people do see confidence. We are not self-sufficient for milk and dairy products, and we know some are in high demand around the world.”