Cheap milk versus farmers' rights?

Former_MSE_Andrea

Poll started 27 March 2006: Cheap milk versus farmers' rights? A milk price war's simmering in the supermarkets but cheaper milk means farmers believe they're being squeezed tight. So where do your loyalties lie - to your pocket or farmers' fair play?

a. My pocket. The cheaper the better regardless
b. Mid-way. I'm a bargain hunter but would pay a little extra if it helps
c. Farmers' fair play. The cost's irrelevant; the supermarkets should be ashamed of the way they treat producers

You can read more about the milk war here.

Vote here or click reply to discuss this poll

sd8974

Er, didn't we just do this poll a few weeks ago???

bridiej

I dont remember voting on this one before......?

I often wonder what would happen if the milk farmers got together and decided they wouldnt supply the supermarkets anymore until they had a fair price....

sablade

bridiej wrote:

I dont remember voting on this one before......?

I often wonder what would happen if the milk farmers got together and decided they wouldnt supply the supermarkets anymore until they had a fair price....

supermarkets would then buy from europe or poland

I think anything produced outside UK should have import tax to help our local producers, and how come its illegal for our farmers to mis treat animals but our supermarkets can buy mis treated pork from europe

glittergirl_3

It's a bit disingenous to suggest that either the farmers get a fair price or consumers do. Both could be doing very happily if there wasn't such a massive lump to pay to the supermarkets, surely?

irritable

MSE has got me irriatable again on one of my pet hates ... supermarkets and their exploitation of honest working people.
1. What sort of saddo is influenced by a few pence off a pint of milk?
2. Why don't people recognise that by supporting supermarkets they contribute another nail in the coffin of British Industry. Then we hear the same people complaining that they cannot get a job, except on some studip Blairite scheme to reduce the unemployment stats.
3. Whilst destabilising British producers, we strengthen the eventual succession of East Europeans. How long before we become the "Third World"?
4. By paying a fair price for milk to a different retailer, we will send a strong message to the supermarkets. Although in issolation the question of milk prices is relatively small, in terms of the overall power of the supermarkets and their impact on the whole economy and working conditions in this country, the action which consumers take now is of great importance.
5. No, I am not a farmer, socialist, economist, student or other "extremist". I am a simple company Director who doesn't like the way that our once great country is heading and who blames the supermarkets for at least a part of that demise. :mad:

petite_amie

Just a thought but you could all support your local milkman, and order the organic milk while you're at it..... tastes like milk used to taste!

hjb123

bridiej wrote:

I often wonder what would happen if the milk farmers got together and decided they wouldnt supply the supermarkets anymore until they had a fair price....

1. The supermarkets wouldnt bother about the farmers - they would go elsewhere for their milk!

2. The farmers would lose more money than they are already and go out of business - many are already thanks to the government not paying out the Single Farm Payment subsidies when they were due!


The supermarkets and suppliers are paying peanuts to the farmers and alot are really struggling to survive.

farmersam

:T Well done to all for getting this post started as it is a very important one. I have been a "board viewer" and MSE member for ages now, but feel strong enough to comment on this one.

Apologies for what will be a long post, but the consumer needs to know.

There is only one answer - c. Farmers' fair play. The cost's irrelevant; the supermarkets should be ashamed of the way they treat producers.

I am a consultant specialising in advice to dairy farmers, so see everything first hand.

Once again the supermarkets are flexing their arms because they can. UK agriculture is in turmoil, and a huge number of businesses will not make it this year. Milk price is again falling due to dairy processors protecting their margins by passing on any cost increases e.g. fuel, labour, energy costs etc to the farmer. Problem is the farmer cannot pass his cost increase onto anyone, so actually makes less money as a result. You may have seen in the press that ASDA started a push (admitidly on the back of bad publicity by farmers demonstrating outside their stores) to increase their milk price to farmers (although this milk price increase only goes to specific dedicated suppliers), whilst at the same time cutting the milk price to the comsumer i.e. you an me as detailed in their four pint pledge giving a saving of 16p for four pints. Why did they do this? - goodness knows as it is unlikely that it will get more people to buy milk as you either need it or you don't. Also, how many of you can tell me how much you pay for your milk? I can't, i want it for my drinks and cereal, so i will get it regardless of price (well to a reason). Also, there is a huge level of research that shows that milk sales are not determined by price.

Shame though that in the four pint pledge where they say they pay the most for the milk, to try and win some PR they excluded some of the milk contracts such as Waitrose and M&S and also Wiseman Manchester (all higher) and also included milk prices before the recent round of price cuts that farmers have received over the last 2 months.

So what you say, but this just means that all the other supermarkets cut their prices, and we have a price war = price cut to the farmer so that everyone elses margin is protected.

Once again, the supermarkets margins have increased massively, the processors have held their profit margin even in a tougher market place, whilst once again the farmer loses out as the cost gets passed back to him. Interestingly the NFU (National Farmers Union) and RABDF (Royal Association of British Dairy Farmers) have just commisioned some work detailing farmers actual costs of production in comparison to the milk price see...... British Milk - What Price?.

So what you may think - who cares, i'm getting cheap food/milk. Work by the Milk Development Council (MDC) shows that Dairy farmer numbers fell by 7% last year. This is as a direct result of price pressure, and many businesses not being able to cope. Farmers are business men, and as with any business, they can only afford to go on for so long.

Farmers are receiving the same price for their milk that they were in 1993 - so factor in inflation and they're going backwards fast, meanwhile, prices in the shop have leapt up.

What can they do about it?

Really not much.

If they protest, they get bad press and are called whingers and moaners for trying to raise awareness and allowing them to survive, plus it alienates the consumer - not what is wanted!! Also they haven't got time to protest as they are working too many hours and can't find labour to manage the stock whilst they are away from the farm.

If they stop selling their milk - 1) they lose their income, so makes it harder to survive 2) they could be in breach of their supply contract so could lose their milk buyer and again their income source.

If they club together the government jumps on their back and instigates an office of fairt trading investigation - recently a milk buyer was taking over a company in scotland that only accounted for less than 10% of scottish milk. The OFT ordered an investigation saying that it would stop compettiveness - meanwhile supermarkets are still allowed to do what they want - if you sold a product today, could you afford to wait for 90 days (yes thats 3 months) until you get paid - that's what the supermarkets do.

Farmers have tried to cooperate. There used to be one big farmer coop, but the government said it was too big and forced it to split into 3 seperate companies - there's so called progress for you!!

meanwhile at the same time, farmers in the UK have the highest welfare standards and legislative standards compared to other European countries - partly instigated by the supermarkets - for example pigs have to be housed in straw yards - meanwhile stalls and teathers are allowed in other countries that the supermarkets import from therefore allowing those producers lower costs of production and meaning that the UK cannot compete on price.

The rural landscape is changing. In certain parts of the country, due to the lack of farmers, some businesses cannot even rent their land out. This is then left doormant, which over time means it will return to scrub etc which will change the landscape that everyone wants to walk in and visit.

Im not against the supermarkets as they are very good at what they do, but hey lets have a bit of ethical trading please we've got fair trade, why not fair uk trade?

Make sure you buy british in your food shop, it cuts down on food miles and pollution and will be a product that is reared to higher standards, also it means that an extra uk farmer will stay in business and the countryside will stay in its current glorious condition.

Also, do consider shopping elsewhere such as your greengrocer and butcher. We have just started doing this as our Sainsburys quality was rubbish, we are now saving £25/week on our food shop and getting better quality goods, and only using the supermarket for certain items. Yes it's a bit more hassle, but i'm sure you'd like to save a bit more money!!! Supermarkets are always thought of being the most competitive, but a lot of the time (or at least in my area) they are not.

Sorry for the long post, and hope i haven't bored you all too much!!

avantra

I have studied the UK milk supply chain for my dissertation last year (2005). The milk farmers of this country are playing on an un-even playing field with their counterparts in the EU, the supermarkets knows this and can squeeze more profit.

The best thing we as consumers can do is to opt and only buy our fresh liquid milk (different supply contract and different prices than dairy products) in places like Waitrose and M&S.

The above outlets gives a fair price to the farmer of 21-22p/litre (it cost to produce 17p/litre in average).

If you don't have M&S or Waitrose you can look at the latest wholsale prices here:

http://www.fwi.co.uk/gr/mprdeliveriestable.htm

and try to read the lable on the milk bottle for it's origin.


I think that milk should fall under 'fair trade' lable eventually.

Mary_Hartnell

Milk producers have always been in a dodgy position.
There used to be a fine office building overlooking the green at Thames Ditton.
It housed the Milk Marketting board.
The MMB was set up between the wars, in an attempt to save milk farmers in this position last time round. Do you remember Drinka Pinta Milk A Day & Humphries etc.
The MMB site is now full of expensive houses and the farmers have to fend for themselves.
A hundred and thirty years ago my great great grandfather was boasting on his census return that he was a "Farmer with 135 acres 5 men and a boy" - you could just about starve on that size of scruffy grazing farm now.
During his gap year my son worked on a farm in Australia. They got three crops a year. He was sitting in an armchair and steering a tractor costing 100,000 and it took him twenty minutes to drive it to the "field" where he was working.
In most things we are in a global market - how many steel workers do you know in Britain. I used to be part of the British shoe industry. I notice that the British Shoe Machinery Company Pension Fund is one of the disaster areas
where the pensioners age getting a fraction of what they were expecting.

Farming is not yet a global market - it is still way of life that your household and mine are subsidising to the tune of 20+ pounds a week. So dairy farmers have a choice get bigger, gang up in cooperatives, or get a niche market selling direct to the consumer - smelly cheese anyone ?, emigrate - there is still cheaper land to be had in USA and Tasmania is very like Ireland.
Try a different enterprise, here in Essex, I get to visit several farms, they all seem to have a thriving industrial estate in what used to be the old barn area. (Now where can we put that phone mast, next door to the wind farm ? Dig out some gravel to make a fishing lake? Livery stables, next to the paintball wood ? With 14 days a year of legal boot sales anyway who is counting), you don't even have to farm these days to collect the single farm payment, if you do agree to keep the land traditionally you get extra subsidy for the wildlife interest (if the Rural Payment Agency ever gets a round tuit and pays out - but that is another story) So sell out to a rich person who can pretend to farm, collect the subsidy and relish the fact he will be exempted from the inheritance tax that everyone in the London area with a house will have to pay.

I cannot see it lasting myself. How long will the Polish land workers on less than a pound an hour, be prepared to sit on the sidelines watching 2/3rds of the VAT we pay to Europe being spend as what is really extra pension for ageing farmers ?
New Zealand grasped this nettle about 15 years ago. It was very nasty for the traditional commodity farmers, while land prices fell to an economic level.
Even nastier for Landlords as high subsidies prop up high land prices.
But as they say in New Zealand - lean & mean is clean and green.
Remember, when you buy the jug of milk in the Supermarket, you have already paid a wedge of money for it.