As dairy markets begin to show glimmers of improvement after what has been a financially crippling time for the region’s milk producers, key players in the sector are calling for increased returns to be passed to farmers as soon as possible.
Michael Oakes, National Farmers Union (NFU) dairy board chairman, said on the eve of the Livestock Event in Birmingham, the leading business event for the livestock sector, that with further positive moves on the markets more money should now be coming back to the farm gate.
Call for dairy returns as prices start to turn corner
| Posted: July 05, 2016
Michael Oakes, who farms on the outskirts of Birmingham, is calling for dairy farmers to start seeing returns as soon as possible
As dairy markets begin to show glimmers of improvement after what has been a financially crippling time for the region’s milk producers, key players in the sector are calling for increased returns to be passed to farmers as soon as possible.
Michael Oakes, National Farmers Union (NFU) dairy board chairman, said on the eve of the Livestock Event in Birmingham, the leading business event for the livestock sector, that with further positive moves on the markets more money should now be coming back to the farm gate.
Dairy commodity prices have strengthened with AHDB figures showing that as the markets have continued to firm throughout June, wholesale prices have also been pushed up. The bulk cream price increased 28 per cent between May and June while the estimated cream income to a liquid processor up by 1.41ppl to 6.40ppl in June.
However, despite a number of milk price increase announcements for July and August, Mr Oakes warned prices remain far below sustainable levels on farm. «We need to ensure that extra money is passed back to farm as quickly as possible,» he said.
«With the cream prices rising, we should be seeing milk prices improve across the board and in that respect it was disappointing to see Muller hold the milk price for August. There are clearly delays which just don’t make sense.
«Both AMPE and MCVE, dairy market indicators, have recently increased, with AMPE up 12% to 18.9ppl in June and MCVE up 19% to 19.6ppl in the same month.»
Mr Oakes added: «With such leaps forward in those price indicators surely we should at least see some of the lower end cheese prices start to improve.
«Spot milk prices have also jumped from 16ppl in May to 25ppl in early July, yet we haven’t seen such a big lift in B prices – these should theoretically be the first to react to market improvements.»
And commenting on liquid milk, Mr Oakes went on to say that it was important to make sure that retailers are not «hiding» behind any retail premiums. «Retailers have stuck by their word with minimum pricing on liquid milk, and in some cases on cheese, but these should not be used to hide real dairy market improvements,» he said.
Andrew Branton, chairman of the NFU South West’s dairy board, also warns today that even as industry analysts begin to speak of recovery, there is a danger of failing to learn lessons before the state of the dairy industry starts to improve.
He said: «Processors must do everything possible to pass any returns back from the market as soon as possible, in order to boost confidence and avoid a greater loss of production than absolutely necessary.»
Source: TheHerald
Link: http://www.plymouthherald.co.uk/call-for-dairy-returns-as-prices-start-to-turn-corner/story-29478935-detail/story.html