MILK producers in Scotland are beginning to recognise the need for greater influence over the processing and marketing side of the dairy industry to secure a fair return for their efforts.
Tom Thomson, the convener of the National Farmers' Union of Scotland's milk committee, said yesterday it was significant that in Northern Ireland, where the producer co-ops were still major processors, the milk price was about 2p per litre higher than in Scotland.
Thomson made his views clear after a crisis meeting in union headquarters at Ingliston attended by representatives from across the United Kingdom.
Deregulation had forced producers to divest themselves of their processing arm, said
Thomson. However, he remained convinced that the way forward was for them to have a major say in the way milk was handled.
Union vice-president Peter Chapman said farmers were perceived to be weak sellers but they had to become more involved with producer groups and co-ops in developing a stronger voice.
The Scottish co-ops could work more closely together to
re-dress the balance.
''Supermarkets are very big and powerful, but I am sure they do not want to see us out of
business, because they need our product,'' he said.
''However, they are not going to pay us more than they can realistically get away with. They are hard-nosed businessmen who will pay what they need to source their supplies - but no more.''
Chapman emphasised that it was not the farmer's aim to force a reduction in the price charged by supermarkets but to get a
bigger share of the price paid by the consumer.
Michael Lambert, chairman of the England and Wales NFU milk committee, said the union had commissioned a study of milk prices throughout Europe.
Those countries which delivered the best price to farmers were the ones where milk co-operatives were in the ascendancy. By contrast, in England, many producers received less than 16p per litre once quality adjustments and transport charges were taken into account.
Producers throughout the country are concerned that the present selling system for Milk Marque, the major co-op south of the Border, is depressing prices paid to farmers.
The NFU in England and Wales is appealing to the Office of Fair Trading to abandon the so-called 90% rule before the next Milk Marque selling round in July.
Under the present system if the co-op fails to win forward contracts covering 90% of the anticipated milk supply it has to re-open the tendering at a lower price until the 90% target is achieved.
In recent months that has led to a steady erosion of prices which has had a knock-on effect north of the Border.
In the 18 months that the 90% condition has applied, farmers have seen prices fall by 24%.
The other major factor in the price equation was the strength of the pound, said Chapman. As sterling began to slip on the international money markets there was some hope that the recent trend had been reversed.
The industry was hoping that the prospect of further falls might concentrate some buyers' minds in July and they would take up Milk Marque contracts rather than stand back and hope to buy on the spot market.
As part of its response to the crisis the NFUS is organising a dairy roadshow which will be staged at four locations next month.
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