The real culprit isthe processor who sold ridiculously cheap milk in a bid to chase volume, andwho surrendered both its farmers and its own margins and who agreed totallyunsustainable prices.
Say all you like about the bad things of the Milk MarketingBoard, but every farmer was pretty much an equal and there wasn’t the mistrust,jealousy, one-upmanship and, frankly, hatred at times that we have had sinceits demise in 1994.
Thus it’s a surprise that some of Muller’s customers don’t want totake advantage of the mechanism in a bid to smooth the market volatilityextremes, and be seen to pay a fair price.A similar formula has been very successful with Glanbia in Ireland forits farmers and customers.
The worst any commentator or analyst can dois to give dairy farmers false signals, to build up expectations that they canride it out, and suggest a recovery to near 30ppl is down the line.
The court of exchequer is a remarkable instance of this. It was originallyintended principally to recover the king's debts, and to order the revenues ofthe crown. It had a common law jurisdiction, which was established merely forthe benefit of the king's accountants. We learn from Blackstone, that theproceedings in this court are grounded on a writ called quo minus, in which theplaintiff suggests, that he is the king's farmer or debtor, and that thedefendant hath done him the damage complained of, by which he is less able topay the king. These suits, by the statute of Rutland, are expressly directed tobe confined to such matters as specially concern the king, or his ministers inthe exchequer. And by the articuli super cartas, it is enacted, that no commonpleas be thenceforth held in the exchequer contrary to the form of the greatcharter. But now any person may sue in the exchequer. The surmise of beingdebtor to the king being matter of form, and mere words of course, the court isopen to all the nation.
Cullcows are selling for almost record prices and farmers will offload them ratherthan feed them to produce marginal litres for an unreasonable return.
Was itcoincidence that DC announced the 2p drop so close to the end of the month,making it nearly impossible for farmers to arrange another buyer, and to givenotice (which they have to do before the end of each month)?
I do not subscribe to the viewwhen it comes to farmgate milk pricing the market operates normally but I dolive in hope that one day at least one purchaser will take the lead and be moreopen, honest and transparent.
For example, in the week our position as the lowest paid dairy farmersin Europe was confirmed DairyCo not only failed to report this significant factit decided to lead with a story which trumpeted the fact that the DEFRA averagefarm gate price for May was the highest on record!And within days its next Dairy Market Updatelead story was headed “Have wholesale markets peaked?” implying that wholesalemarkets were falling.
I am stunned at the number of farmers, experts and socalled leaders who still trot out the utter rubbish that the end of milk quotasin March 2015 will not affect GB farmers and the market here because we are,and will remain, well under quota.
If DairyCo hasn’t read the tea leaves I’ll spell it out: marketinformation and promoting milk and dairying are what the majority of farmerswant their levy money spent on!
As one prominent dairy industry person stated in anexchange of emails to me: “What the heck is going on at DairyCo?” With liquidprocessors and hungry retailers examining the evidence to support liquid milkprice increases in the reign of 2ppl it will be music to their ears to learnthat the one “organisation working on behalf of Britain’s dairy farmers with aremit to solve market failure in the dairy industry” believes prices havepeaked!
The TFA asked a very interesting question: “How much of the Pillar 2 money endsup with farmers after administration and consultancy costs have been accountedfor?” If the Southern Irish give their dairy farmers a better deal on Pillar 2funding than we get it will be handing them more ammunition for them topenetrate our dairy market further.
The bottom line is the liquid market is presently failingGB dairy farmers, and liquid producers are relying on the big cheese guns likeMilk Link to drive prices up.