A warning is being sounded by dairy farmers that going out of business is on the cards for them since the price they get for milk has dropped, even though the supermarkets are seeing shortages. Freshways the main milk processor in the UK, said that the two pence per litre cut was ‘unfortunate but had been caused by the decrease in trade with pubs and cafes. Peter Pratt, a farmer in Staffordshire, said that prior to this he lost a staggering 65% of his crops due to flooding. The government has indicated that the problem is being handled and is viewed as “a matter of urgency”.
There is also going to be a delay until 15 May of payments from Freshways to farmers, following this “excessive decline”, said Bali Nijjar, the managing director. The chairman of the National Farmers Union (NFU), Michale Oakes, has noted that there are dairy farmers who are “particularly vulnerable” and that the situation is indeed, “highly volatile”. Mr Pratt, mentioned earlier who runs an arable and beef farm with 6 employees has said that the family business has been “hard hit”.
Due to the falls in milk demand as well as prices, 25 per cent of UK dairy framers are now in a financially unviable position, according to the National Farmers’ Union. These farmers are looking for government support due to the pandemic causing the closure of coffee shops restaurants, hotels, canteens, and so forth.
Michael Oakes, the chair of the union talked of the 25 per cent of businesses that are currently not viable and described them as looking over the face of a cliff and not seeing any support for them. Herringbone parlour.
The milk processors that catered to the food-service market in normal times have been decreasing both their orders and prices from thousands of dairy farmers at this current point where they are reaching there annual springtime peak in milk production. In other words, over 10,000 dairy farms are now running their business at a loss. Mr. Oakes noted that before coronavirus these businesses were viable and that representatives from the farming world are in the process of having emergency meetings with the government.
There are several sectors within agriculture that are struggling and dairy farmers are one of these; there is also a labour shortage for fruit and vegetable farmers and the demand for red meat has also dropped, having a negative impact on livestock farmers.
George Eustice, the environment secretary said that the concerns of dairy farmers are heard very clearly and has resulted in continuing to suspend competition rules law. There is also an urge for businesses to make use of bank loans that are currently available to provide support at this time.
However, dairy farmers have noted that they are finding it difficult to access government support, as well as bank lending, for businesses that have been affected by the pandemic.
Arla Foods UK, milk co-operative, has said that there has been a considerable increase in consumer demand and that they have succeeded in increasing supplies to supermarkets by making significant simplification to their business.
The Managing Director, Ash Amirahmadi, has said that following talks with the government much work is taking place to allow for further co-operation.
One Defra spokesperson said that there is much awareness of the need to redirect produce from hospitality to retail and that this is being looked at urgently.