Milk price cuts hit farmers
You'd think when the nation's crying out for milk, the buyers would keep their heads down having imposed price cut after price cut on the farmers.
But no, Muller's CEO was reported the other day as saying they are "obliged" to keep the supply chain going. What heroes!, writes Rosemary Allen.
Muller is offering 1p per litre increase to farmers complying with their "Direct Premium" scheme, for farmers who conform to their demands for high welfare, to not shooting surplus bull calves and being environmentally friendly. So do they also take milk from farmers who don't comply? Obviously, or there wouldn't be a different "premium." Or do I misunderstand?
The new price is 27.25p pl. However, in 2018 they paid 29.5p pl, but in January 2019 they dropped it by 0.5p – still 2p pl more than they are offering now! Average cost of production is 27.14p pl. That leaves 0.11p pl "profit".
Sorry for the boring figures, but they just show that farmers are not paid enough to keep going, so there'll less milk when we suddenly realise how much we need it.
Muller is not alone. Two other companies have cut their price per litre, making it even more difficult for farms to pay. Bodes well for after Covid-19 doesn't it?
*Rosemary Allen is a retired livestock farmer living near Ellesmere
