Supermarket to pay top price for milk to help dairy farmers
NewsTuesday 27 May 2014
For decades British dairy farmers have felt that they were being pushed into extinction by the plunging prices being paid by supermarkets.
The large retailers have been paying less and less for milk, which has seen many dairy farmers go out of business or switch to other forms of farming.
Recent figures have shown that the number of dairy farmers has fallen to just over 14,500 from a whopping 25,000 10 years ago. And, there are other warnings coming that have claimed a further 2,000 more could go out of business in the next couple of years.
However, according to the Guardian, one retailer has decided to offer dairy farmers a deal that sees selected farmers receive the highest price on the market for milk.
Booths, the family-owned food and drink retailer currently sells six million litres of milk in its stores each year.
Booths currently has 29 supermarkets in the north of England in Lancashire, Cumbria, Yorkshire, Cheshire and Greater Manchester, and it has pledges to pay the top rate of milk prices, which is currently 35.5p a litre.
Booths may not be a huge player when it comes to supermarkets, but its “Fair Milk” deal, with supplier Muller Wiseman, has been heralded by farming groups as a sign that some retailers are finally seeing the issues facing suppliers.
Many supermarkets are utilising cheap milk in order to attract customers. For example, Asda and Morrisons have both sold four-pint bottles of milk for just £1. Suppliers have spoken out and said that they cannot make any money on prices that low.
Farmers Action are a pressure group, and they have estimated that dairy farmers are required to sell milk for around 30p a litre in order to break even.
The scheme will see dairy farmers, in each of the four counties in which Booths has a store, being paid the agreed rate. This rate is being established by an independant price comarison consultancy called milkprices.com.
Booths has stated that it will now be reviewing its market price on a regular basis to ensure that it is paying its farmers more than its other supermarket rivals.
Edwin Booth, the chairman of the retailer, spoke to the Guardian, saying: "As dairy farmers are under pressure, we guarantee to pay our farmers the highest market price for every pint of milk we sell.
"Paying the highest market price means family farms are able to keep going, invest in the future and spend more time and money looking after their herds to ensure they produce great quality milk."
The chief operating officer of Booths, Chris Dee, has also spoken to the paper saying that their decision to pay these higher rates was all about sending the right signals to other retailers.
“We are trying to do what we think is right,” he said. “We are not suggesting that we will be able to make that much difference. It is symbolic. But it does demonstrate that there’s a supermarket out there who will pay top dollar and the farmers do genuinely believe it makes a huge difference to them.”
Christopher Dodd is one of the dairy farmers who will benefit from the deal. Mr Dodd farms in Cheshire and he said that the higher farm gate milk price would mean that he could expand his business to ensure a “sustainable financial future”.
This is fantastic news and it really is great to see Booths making such a statement in deciding to pay high rates for milk. Let’s hope the other giant retailers sit up and notice what is going on and follow suit.