Milk price protests and blockades look set to continue through the summer, despite farmers and producers agreeing in principle a voluntary code of practice on contracts.
Farming minister Jim Paice brokered a deal between industry body Dairy UK and the Dairy Coalition of farmers and their representatives, at the Royal Welsh Show yesterday. But the agreement is only designed to remedy the dysfunctional market in the medium to long term and will do nothing to avert a damaging two pence per litre cut set for August 1.
The protest group Farmers For Action (FFA), which has been leading demonstrations across the UK, including outside the Robert Wiseman Dairies processing plant in Somerset, has vowed to continue fighting until farmers receive at least the price it costs them to produce milk.
Defra claims that changes in notice periods and pricing changes will allow farmers more freedom and flexibility to negotiate better terms and leave unsatisfactory contracts and hopes to seal the deal by the end of August.
But critics have called for new laws to force a fair price at the farm gate.
Bridgwater and West Somerset Conservative MP Ian Liddell-Grainger said a voluntary code, without any sanction for processors or supermarkets, was doomed to fail.
“There is no way it is going to work – it is just another rather sad red herring – it has been tried I don’t know how many times and it is always a disaster,” he added.
“It will last for a bit then they will all renege when it gets tough, take it out on the farmer and we will be back to square one.
“Jim Paice said he will not legislate at this time – all I can say is prepare for legislation – if we can set a minimum price for alcohol we can do it for a strategic resource like milk.”
Dairy farmers are furious at cuts to farm gate prices which they believe will force many out of business.
They want the Government to force supermarkets and suppliers to sign up to a compulsory code of practice, a move Mr Paice claims is not possible under European rules.
After the meeting yesterday, Mr Paice said: “I welcome the commitment all sides have shown to reaching an agreement.
“The Government will continue to work with all parts of the industry to secure its long-term future, including promoting farmers working together in producer organisations.”
National Farmers’ Union president Peter Kendall said the announcement gave “some hope” for the long term but “did not solve the dairy farming issues of today”.
“This agreement will give us the architecture we need to make sure that we don’t end up with the same dysfunctional markets that are responsible for the dairy crisis we have today,” he said.
The heads of terms for the proposed code stipulate that farmers must receive at least 30 days’ notice of a price change and rules out retrospective price adjustments as no longer acceptable.
When setting farmgate milk prices, producers must show a “commitment” to engage with farmers and their representatives and to maintain prices within mutually agreed parameters.
Where a farmer disagrees with a price change, he or she will have the right to exit the contract with three months’ notice.
Farmers will also be allowed to supply more than one processor where their primary milk buyer seeks to cap their production.
Anne McIntosh MP, chairman of the EFRA select committee, expressed frustration at the failure of the Government and dairy industry to finally agree a voluntary code in 14 months and urged legislation if talks break down.
She said: “In evidence to our committee last week we heard first-hand how time is running out for many dairy farmers.
“We urge the Government to secure the voluntary code as a matter of priority. If it cannot, then legislation must be considered.”
Other posts from this source: Western Morning News