Comment: Dairy farmers win price battle, but the war is not over yet
A FORMER president of the National Farmers Union of Scotland (NFUS) once told me that dairy farmers were the only ones who would go to a protest meeting about milk prices, and then on the way home make plans on how to increase their output.
I quietly disagreed because that is the best way to deal with an opinion that differs from my own. I could think of other sectors where farmers think they see opportunities in adversity.
Potato growers classically try to increase their acreage after a bad year because “it will be better this time”.
However, the point is I hope that milk producers have not been thinking over the weekend that – thanks to their efforts in organising protests and raising the profile of the unequal share of the end price – they have forced retailers and processors to capitulate and the war is over.
To my mind, nothing could be further from the truth. From the producers’ point of view, a small battle has been won. From the processors and retailers what has happened is a setback to planned price cuts.
Read the words that emerged from some of those who rescinded their plans to reduce the price they pay for milk. Mueller/Wiseman stated it would “hold its price for the month of August” and Arla said it would “maintain the price”.
Neither of those two big players in the milk sector went one step further. Neither indicated any support for a voluntary “code of conduct” that might bring more equality into the cash side of the milk supply chain.
So all that has happened, as far as I am concerned, is that milk producers have managed to forestall a cut in their price. Their long-term situation – and by that I am talking months not years – is little better than it was a month ago.
In fact, there might well now be resentment in the dairy sector by businessmen who feel their planned cuts have had to be rescinded; regardless of the rights or wrongs of the cuts.
Dairy farmers should remember that revenge is a dish best served cold and I bet there are a few operators who have seen their plans countered by the protests and who are not happy.
In my book, farmers have to use the small window of opportunity, that is only one month in Wiseman’s case, to see what other measures can be brought into play to give long-term strength to their end of the milk supply chain.
The meeting today in Lanark Mart provides an opportunity to put some definite plans into action. While it is also a political platform with the cabinet secretary speaking, the onus for change lies with the farmers themselves.
As a journalist a couple of decades ago, I attended several meetings organised by Wiseman Dairies where Alan Wiseman – taking off his jacket, displaying his red braces, and looking for all the world like an Old Testament evangelist – promised to lead the producers to the promised land. Although I have not heard personally from him since the family business was sold for £100 million, I assume the cash paid for his ticket to that destination.
Now, those farmers who followed him and have, metaphorically, been left in the desert, can retrace their steps and consider whether to join a producers’ organisation (PO).
In many producers’ minds, joining a PO means giving up some independence and that is a step too far for many independently minded farmers. Some may not even realise that they would retain ownership of their milk only foregoing the selling of it.
Another possible step would be to join or rejoin one of the co-operatives. First Milk has travelled a rocky path at some points in its short history since it emerged phoenix-like from the bonfire of the former Milk Marketing Board.
But it is now under the feisty leadership of Kate Allum, whose previous life saw her promote McDonald’s in Europe. So it is easy to see the source of her enthusiasm for getting more from the market place through branded goods.
If dairy farmers look to their European neighbours enviously with their strong milk co-operatives it seems to me to be an ideal time to move in that direction themselves and co-operate.
They have shown they can work together to stop events happening. Have they the bottle to make things happen for themselves?
Search for a job
Search for a car
Search for a house
Weather for Edinburgh
Thursday 23 May 2013
Temperature: 5 C to 10 C
Wind Speed: 25 mph
Wind direction: North west
Temperature: 3 C to 13 C
Wind Speed: 20 mph
Wind direction: North east