The Tenant Farmers Association has called for a strong dairy industry
regulator, with teeth, that can adjudicate between retailers, processors
and producers of milk.
Speaking before the national Dairy Event at Stoneleigh, TFA National
Chairman, Reg Haydon said, “There is something wrong with
a market which continually shows declining returns to farmers,
consistent returns to processors and increasing returns to retailers.
We have seen dairy farmer after dairy farmer go out of business
because they can no longer cover their costs of production from
the low milk price that they are receiving from processors”.
Over the past 10 years we have seen milk prices paid to producers
fall by around a third whilst costs of production have steadily
“Dairy farmers have experienced an escalation in costs. The
implications of enhanced dairy hygiene regulations, requirements
for dairy farm assurance, increasing environmental regulation,
new laws on pollution and waste coupled with increased diesel and
fertiliser prices have all added to the cost burden faced by dairy
farmers. You cannot go on adding to the regulatory and financial
burden of a sector which is already losing money. The price received
by dairy farmers must reflect the cost of production and provide
a return for their managerial and capital input to the business.
It is no exaggeration to say that dairy farmers have simply been
driven out of business by the market failure that exists” said
“Given the structural imbalance that exists within the market
place, the TFA believes it is time we had an industry regulator
with the ability to investigate both processors and retailers to
ensure that excessive profits are not being made at the expense
of producers and the long term interests of consumers. The regulator
should also ensure that the manner in which supermarket and processor
contracts are drawn up are fair and non-discriminatory. Indeed,
the TFA would like to see the concept of a regulator with teeth
apply across all of farm produce but it would be sensible to start
with the milk sector as it is the one which is in the most critical
need of action at this time” said Mr Haydon.
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