A North East MEP has stepped in the debate over the impact of the milk price crisis on dairy farmers in the region.
A combination of oversupply, global economic conditions and supermarket price wars mean many are now receiving as little as 20p per litre for their milk, forcing them into loss making situations, and, according to NFU, contributing to a dramatic fall in numbers working in the sector.
On Friday, North East Labour MEP Paul Brannen sought to gain firsthand insight into the effect the trend is having by visiting a dairy and arable farm at Eachwick, near Ponteland, run by brothers Dennis and Richard Gibb.
The pair have seen the price they receive for their milk drop from around 33p early last year to 24p and have responded by attempting to increase efficiency as best they can.
However, adapting to the threat faced by the industry has meant long, unsustainable working hours.
Following the visit, organised by the NFU, Mr Brannen said: “This is a complex issue which has many causes, including the Russian ban on importing farm produce for the EU.
“The fact that global forces impact on local farmers here in the North East shows why we need to work together at a European level.
“I’ve heard some people say that milk producers need to be more efficient or that they need to respond to market forces and if they can’t make money they should go out of business like anyone else.
“I just don’t agree with that view because not all milk is created equal. In response to consumer preference, milk produced in the UK is often produced by cows who are grass fed and spend the summer outside. If we rely on imported milk we just can’t guarantee the quality.
“Reductions in milk prices might seem like great news for consumers who are under pressure from squeezed living standards. But a short-term saving in price can have a medium and long-term effect on the dairy industry.”
In the future, he said, this could mean consumers having milk imported from many miles away, rather than produced locally with high standards of animal welfare.
There could also be a significant impact on jobs and the environment in the region, as dairy farmers provide employment both directly and within their supply chain.
“I’d like to see action taken to protect the industry here in the North East and elsewhere in the UK,” he said.
“As a first step, Labour wants to see a review of the role of the Groceries Code Adjudicator with a view to their scope and powers being increased to enable them to act across the whole of the supply chain.
“Currently their scope centres on the processors and the retailers. The process has to also include farmers.”
In the longer-term, he added, farmers needed to get more involved in the processing of their milk into higher value products such as cheese and yogurt.
“This will involve more collective and co-operative working to enable farmers to increase their clout in the market,” he said.
“I believe farmers are against the reintroduction of EU milk quotas because they would have a negative effect in the medium term but would welcome fresh efforts by the Government and the European Commission to open new markets for UK dairy producers.
“We should all demand retailers respect the situation of farmers who need to receive fair and stable price for their produce in order to maintain continuous production.
“There is also a role for customers in asking their supermarket managers for a guarantee that they are paying a fair price to British farmers for milk.”
Dennis Gibb, who has been a member of the NFU’s dairy board for around a decade, said “It was good to see Paul on the farm seeing for himself the impact of the low price of milk. We are passionate about what we produce and it’s demoralising to see the price so low in the supermarkets.
“It devalues what we do and it doesn’t represent the hard work that goes into producing it. We just want a fair price for the quality milk we produce.”