Appeals for urgent government action to save the dairy industry have been backed by the entire supply chain, including UK farming unions.
The group – which includes the Royal Association of British Dairy Farmers (RABDF), Dairy UK and the Provision Trade Federation – has written to the Defra Secretary George Eustice calling for action.
They support three key proposals put forward by the NFU to protect dairy farm businesses from irreversible damage:
- A targeted grant scheme for affected farmers that is similar to the Retail and Hospitality Grant Scheme;
- A fully-funded, Government-run voluntary national production reduction scheme, which effectively furloughs dairy cows;
- Engagement with the EU Commission to introduce market support measures, such as Private Storage Aid.
Elements of UK competition law will be temporarily relaxed to support the dairy industry through the coronavirus outbreak.
The intention is that the industry will work together to address current market challenges, avoiding waste and maintaining production capacity to meet future demand.
Many of the UK’s dairy processors have hit crisis point. Earlier this month, Muller suppliers across the UK were asked to reduce milk output by 3% while Freshways, the UK’s largest independent milk processor, told farmers it would not be able to collect all of their milk.
In the letter, the three unions write: “The situation is continuing to escalate rapidly with serious financial consequences for many individual businesses. There are farmers unable to pay their feed companies and having to sell cows.
“There are dairy companies that, having lost all of their key markets, still have to deal with the milk and find a home for it in an oversupplied marketplace.
“These may have been isolated impacts to start with, but we know that already around a quarter of the dairy industry has been affected within just a matter of weeks.
“It is important to reiterate that only a matter of weeks ago, all of this milk had a good home, and hopefully in a few months’ time, those markets will return.
“The British dairy sector wants to be there to meet that demand, so it is crucial that the industry is not irreversibly damaged by this crisis.
We need action now, as well as a more considered response for the medium and longer-term measures. We cannot over-emphasise the urgency of the current situation.
“Unprecedented times call for unprecedented measures, as the Government is already demonstrating elsewhere. We believe now is the time to do all we can to ensure the long-term sustainability of the UK dairy sector.”
