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    No Benefit To Farmers Of Increased Retail Milk Price Rise
26/01/06

photo courtesy of www.jennifermackenzie.co.uk
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Farmers are yet again witnessing consumers being asked to pay more for their milk but seeing no benefit at the farmgate.

Tesco was the first to announce an increase in its retail milk price of 2.2 pence per litre, and now all of the major retailers have followed suit with increases of between 2 and 4 pence per litre. The supermarkets claim that the rise comes after increased pressure from processors to retrieve more out of the marketplace to cover increased costs. It has not yet been confirmed whether any of this increase will be passed back to the farmers.

Willie Lamont, NFU Scotland Milk Committee Chairman, speaking at the committee meeting on 25 January, said:

"More and more we are hearing from consumers themselves that they are keen to support Scottish farming.

"It therefore defies logic that when consumers are asked to pay more for a high quality product like milk, none of this increase in price seems to find its way back to the farmer.

"We hear time and time again from both supermarkets and processors that due to the higher costs they are facing they are increasing the retail price or cutting the price paid to farmers. Farmers are facing increased costs too (in the last 18 months to 2 years, costs have gone up by as much as 3 pence per litre in some cases), but they have nowhere to pass that extra cost down to.

"Early last year, the retail price of milk went up by an average of 3 pence per litre and farmers were promised 1.5 pence of that. However, many farmers have seen nothing and even those best off only saw 0.7 pence. This situation is wrong and unjust. Supermarkets, and in some cases processors too, are seeing their profit margins rise while dairy farmers across Scotland continue to go out of business.

"It looks like nothing has changed in 2006 as we continue to see retail prices rise with no promise of any of this ever reaching the farmer. Dairy farmers still live in fear that the farmgate price will be cut yet again and that their livelihoods could be shattered.

"Farmers have cut costs to the bone and now need a fair farmgate price in order to be sustainable. When consumers are crying out for quality Scottish produce and when governments are calling for farmers to take impeccable care of the countryside, it is disgraceful that retailers and processors are grinding farm businesses into the ground for their own gain.

"There is real anger amongst members of the Milk Committee today and we will not rest until we see Scottish farmers getting a fair share of the profit margin, not only on milk but on all produce.

"It is time that supermarkets stopped trying to con the consumer into believing that when they pay more they are doing anything other than lining the pockets of the supermarkets themselves."

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