NFUS seeks explanation from milk giant
With milk production plummeting, commodity prices rising and spot prices for milk over 31p per litre, NFU Scotland has slammed the decision of milk giant Müller to hold its milk price for September.
After almost two years of unprecedented turmoil in the dairy sector, milk markets have eventually emerged from the downturn with some strong positive signals.
In stark contrast, the decision by Müller to hold its September milk price to its farmer suppliers who are not on a supermarket contract has caused anger, disappointment and frustration.
NFU Scotland Milk Committee Chairman Graeme Kilpatrick, who spoke to representatives of Müller UK yesterday, said: “This decision by Müller to ignore market signals is a slap in the face for its non-aligned producers who have endured two years of falling prices and were looking to their milk buyer for a confidence boost.
“Muller’s response to our enquiries shows that sadly, once again, we are into a blame game where processors claim they need to be competitive and cite other processors for not increasing their prices.
“That is a sad reflection that lessons of the past have not been learned, milk prices that are quick to fall will be too slow in responding when the market turns and producers are once again left carrying the can.
“NFU Scotland believes that must not happen this time around. There is an unequivocal case for the whole dairy market to lift – from retail prices through wholesale commodity prices and all the way back to the farmgate.
“I can think of no justifiable reason why Müller has chosen to ignore the market and leave their non-aligned suppliers languishing with an unsustainable milk price.
“In the depth of the crisis, it took hard work by grassroots farmers and farming unions to secure a top up to the prices received by non-aligned farmers from retailers such as Morrisons, Lidl and Aldi. That added a valuable supplement to Muller’s base price. I sincerely hope that Muller isn’t hiding behind this retailer supplement and using it as an excuse for not lifting prices now.
“As a liquid milk-led company, Müller Wiseman has, in the past, used poor returns from cream markets as a justification for dragging down or holding farmgate prices. Figures suggest cream incomes to a liquid processor like Müller are up by more than 50 percent on this time last year.
“In the last month alone, market analysis by AHDB Dairy suggests that wholesale butter prices have risen by 21 percent; milk powder by 15 percent and bulk cream prices by 25 percent.
“While other milk buyers are responding – albeit at a rate that is frustratingly slow – to see a major milk buyer holding its September price is unacceptable. It’s about time some of significant market increases make their way back to Muller’s non-aligned farmers who deserve a fair milk price.”
