The upcoming consultation on the introduction of mandatory milk contracts with minimum standards could be a once-in-a-lifetime opportunity for the sector.
Scottish industry leaders have warned the UK Government is unlikely to ever offer a similar chance for dairy farmers to have their say on contractual regulations again.
Commenting on the milk contract consultation, vice president Gary Mitchell said the issue of dairy contracts will be significant not just in Scotland but throughout the whole of the UK.
This may be more significant than Brexit as 90% of a dairy farmer’s income is directly driven by the terms of their contract rather than support.
“The opportunity to be offered by the UK and devolved Governments recognises that the dairy supply chain does not represent a balanced, fair reflection of the vital part played by producers.
“Some processors will not agree, but there is a strong case to be made that an efficient, competitive dairy sector can only be achieved by an understanding that all in the chain rely on each other, and a fair share of risk and reward must be established.
“Discretionary imposed pricing; volume management and other important terms should not be forced on milk producers without agreement any longer.
“The options are likely to be complex but the UK farming unions have already completed very significant research with the help of independent, objective experts.
While open-minded to all options, we are convinced that there is enormous potential in developing a UK version based on the Common Market Organisation (CMO) dairy legislation offered by the Government.
“We urge farmers and processors to engage and be open to the logical, reasoned argument. The unions want to use this initiative as a catalyst.”
Once the consultation is formally launched, the union has said it will engage with its members to explain the options in an open and transparent manner, develop views before then articulating these to the Government and processors.
