Give 10p to a dairy farmer

[gone up the hill]

What hope has the consumer got in understanding labeling, when the farmer can't / doesn't understand it.

Intresting article about the dairy crisis on the Daily Telegraph web site @llamedos .

 

[caveman]

Cat amongst the pigeon.
If people can demonstrate in various ways in supermarkets to draw public awareness to the negative effects of milk prices, can not the same be done to open awareness to the "positive" red tractor?

 

[llamedos]

i don't even understand red tractor, and like hell have i got time to look it up whilst shopping

red tractor could mean anything, ooh that's a nice touch to it, a tractor, not relising the deeper implications of it

Until CLEAR labeling is introduced #buybritish is on a hiding to nowhere.

As an aside, I had an excellent conversation yesterday with the manager of the local Aldi, after making a complaint to head office about both the lack of produce on their meat shelves, and the meat that was there being of a poor sales standard, it was an observation at peak shopping time on a friday, complaint made Friday night, they called me at lunch time yesterday.
Its good to talk

 

[llamedos]

Intresting article about the dairy crisis on the Daily Telegraph web site @llamedos .

which headline, there are a few

 

[gone up the hill]

Supermarkets aren't the villains ( in the finance sector )

 

[llamedos]

Supermarkets aren't the villains ( in the finance sector )

Apologies, I tweeted this yesterday, but failed to post it here
Supermarkets aren't the villains in Britain's milk crisis
Over-production exposes dairy farmers to volatile international commodity markets

While there are clearly big differences between the two commodities, there are also marked similarities between the oil and dairy markets. Both are tough industries and both are international markets that are hugely influenced by a combination of global over-production and reduced demand, which have had an adverse impact on UK producers in the past year.

Oil can be stock-piled in its crude form. Milk, being perishable, has to be consumed within days or refined into storable product; mainly butter and its derivatives, or powders and long-life cheeses, which, like oil, are all internationally traded commodities.

Many people are familiar with the Brent Crude oil index but less so with dairy equivalents such as the GlobalDairyTrade series. In the last 18 months the GDT weighted index has fallen by more than 60pc, not dissimilar to Brent Crude over the same period.

In oil, a fall in the index creates an expectation of consumer benefit. If there is public concern, it is about how quickly and to what extent price cuts are passed on “at the pump”.

With milk, while there is a vague understanding of global over-production, the predominant public perception is one of farmers being ill-treated by powerful supermarkets engaged in a price war. Certainly, there is no expectation of benefits to consumers as a result of falling global dairy prices. Public opinion is informed by farmer reaction – protests at supermarket depots and stores, cost of production arguments and price comparisons with bottled water.





If redundant oil workers blockaded refineries and petrol forecourts demanding a special North Sea price based on production costs, they would soon get short shrift from consumers.

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These periodic spats with the supermarkets have been a feature now for over 15 years and the supermarket chains have become used to having their depots blockaded, disrupting their time-critical supply chains to stores. In this episode, a couple of new dimensions have been added: the “Milk Trolley Challenge” – removing all milk from shelves, paying for it and then giving it away – and parading slogan bedecked cows through stores .

This kind of activity certainly catches the attention of the media but in 15 years it has not produced any lasting solution to the problem of price volatility faced by dairy farmers.

This is because the analysis of the problem is flawed and therefore solutions are bound to fail. The frustrations of the farmers are understandable but their perception of cause and effect is not supported by the facts and therefore their protests aimed at supermarkets are misjudged.

Photo: EPA

Supermarkets buy less than 25pc of UK milk output and collectively these retailers pay farmers the highest prices relative to the rest of the market. Because of historical protests, these prices are already the most loosely connected to global downturns. Farmers are therefore attacking their best-paying customers. If successful, their actions will only benefit the farmer groups who supply these supermarkets.

Then there is the fragmented, low-price battle ground of small shops, catering and food manufacturers. this is still an important domestic market, though compared to the supermarket sector, it is much more closely aligned to global trends and far less accessible to farmer protests.

The real problem is the 50pc of the market dedicated to longer-life products like cheese, butter and milk powder. This segment is exposed to international competition and produces much of the volatility in prices.

For example, in January 2014, UK bulk butter was trading at £3,400 per tonne; today the price is around £2,000. That price drop is due simply to global supply and demand issues that have nothing whatsoever to do with supermarkets.





We have strong domestic markets for fresh milk, fresh dairy products and branded cheese, with limited threats of imports.

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Farmer protests are irrelevant to these international markets affected by the downturn in demand from China, Russian bans on EU imports and a global increase in milk output.

Currency has also been a factor. These commodities are traded in dollars and euros and the strong pound has probably affected revenues by about 1.5p a litre this year alone.

The UK dairy industry has undergone massive structural change since the end of the Milk Marketing Scheme in 1994. There are now 60pc fewer dairy farmers and 30pc fewer cows. Yet annual production is very similar at just over 14bn litres. This is because yields have improved by 40pc over that time. Yet the cost of production between the top 25pc of milk producers and the bottom 25pc is still an unsustainable 10p a litre, according to the Agriculture and Horticulture Development Board.

With the global price of oil falling below the cost of North Sea production, the rational response of companies has been to cut back on output and make workers redundant.

Some estimates suggest that 5,500 North Sea jobs have been lost in the last year with the possibility of another 23,000 to go before 2020.

In dairy, with the majority of farmers sole traders, the rational short-term response has been to produce more milk to secure marginal income. UK milk production is currently 3.9pc up on last year (and Ireland it is up a staggering 13pc)

During the past 15 years, “price pass back” and “Buy British” marketing initiatives have, at best, provided short-term relief for farmers and on one occasion landed the industry in trouble with the competition authorities. It is hard to see any meaningful Government intervention. What is needed is a long-term structural solution. The obvious answer is to reduce exposure to international commodity markets by producing less milk.

We have strong domestic markets for fresh milk, fresh dairy products and branded cheese, with limited threats of imports. An annual output level of around 11bn litres would satisfy these markets.

The Agriculture and Horticulture Development Board data suggests that there are still a significant number of inefficient producers in the system who should consider their future in the industry. Reducing output would not eradicate volatility, but it would certainly reduce the impact.

If redundant oil workers blockaded refineries and petrol forecourts demanding a special North Sea price based on production costs, they would soon get short shrift from consumers.

Neil Davidson was the chief executive of Arla Foods until 2005 and before that Express Dairies. He was made a CBE in 2006 for services to the dairy industry.

Credit The Telegraph

 

[Wheyibuggermair]

This clear enough for you?

"Asda is also reconfirming that it is committed to sourcing its own label cheddar using 100 per cent British milk from Arla. This will be supported by an industry-leading move with the introduction of new ‘Made with British Milk’ labelling on product packaging to provide clarity of sourcing"

Also I'm pretty sure if you're buying fruit with a union flag on it, it would be illegal for it to have been grown outside the UK.

By 'across there' do you mean NI?

No, blackberries, grown in Belgium but packed in the UK.

 

[cornishfarmer]

No, blackberries, grown in Belgium but packed in the UK.

How the hell would buy blackberrys? May put a PYO sign up wander ifany mugs would fall for that

 

[Wheyibuggermair]

How the hell would buy blackberrys? May put a PYO sign up wander ifany mugs would fall for that

In a months time I will be PMO but in the meantime have to buy them, but having said that, most soft fruit and veg still seems to be imported, whys that?

 

[Moors Farmer]

No one is "pulling a fast one". If the NFU and FFA had bothered to ask Arla they might have avoided confusing both their own members and the general public.

I wholly agree with this comment, Fiacre. It's also extremely disappointing to realise that our own farming "leaders" most obviously don't understand the various machinations of how the industry operates, even though they'll vehemently maintain they do.

However - the point remains - NFU and FFA are at fault, but it now remains Arla's problem. It is Arla that have to attempt to get the 10p back into the supplying farmers pockets (or not, whichever). It's Arla that will have the finger pointed at them by public who, presumed the 10p went to British farms when in fact it didn't. You are going to be between rock and a hard place.

Genuinely wonder how Arla are going to deal with this.

 

[cornishfarmer]

In a months time I will be PMO but in the meantime have to buy them, but having said that, most soft fruit and veg still seems to be imported, whys that?

Next they'll be selling mushrooms and cooking apples!!!

 

[Breakthru]

Relying on Joe and Jo Public to donate out of the goodness of their heart to a subsidised industry is a crap marketing ploy. I will not be surprised if the Competition Commission have a look at this blackmail/whitemail technique.
Where are FM in this? As usual at the coos tail eating crap. Fire your Board of Directors other than the two new ones and get some real marketing strategy in place where just like Arla butter and cheese products you sell on quality.
The present Board are blind and are only feeding on the carcase of the dying animal. They could and should over the last two years have been proactive and given Jo Public a reason to pay more for an FM premium product.
There is more than one string to this strategy and it will involve farmers and just like Arla vehicle advertising.
Wake up and smell the roses boys and girls or you will as now find you cannot compete with NZ or the Chinese milk factory. You have to do something you are crap at which is Selling! If you or your Board can't work it out fire them and get people in who can.

 

[llamedos]

Dairy Dilemma: What's Hurting European Farmers?

JPMorgan Asset Management Global Market Strategist David Stubbs and Bloomberg's Whitney McFerron discuss how European farmers are getting the squeeze from a global milk glut brought on by falling prices and a rise in production. They speak to Bloomberg's Guy Johnson and Caroline Hyde on "Countdown."

http://www.bloomberg.com/news/videos/2015-08-18/dairy-dilemma-what-s-hurting-european-farmers-?

Source: Bloomberg

 

[Gulli]

Until CLEAR labeling is introduced #buybritish is on a hiding to nowhere.

As an aside, I had an excellent conversation yesterday with the manager of the local Aldi, after making a complaint to head office about both the lack of produce on their meat shelves, and the meat that was there being of a poor sales standard, it was an observation at peak shopping time on a friday, complaint made Friday night, they called me at lunch time yesterday.
Its good to talk

There were a few photos on Facebook and Twitter a couple of days back complaining about labelling.
I counted 8 different places on one photo that the pack of lamb had British or a British flag on it. It was glaringly obvious (to me) that one was British and one was new Zealand. Mainly because that's what it said never mind the flags.
If people can't be bothered to look then having a union jack covering the whole pack won't make any difference

 

[gone up the hill]

I wholly agree with this comment, Fiacre. It's also extremely disappointing to realise that our own farming "leaders" most obviously don't understand the various machinations of how the industry operates, even though they'll vehemently maintain they do.

However - the point remains - NFU and FFA are at fault, but it now remains Arla's problem. It is Arla that have to attempt to get the 10p back into the supplying farmers pockets (or not, whichever). It's Arla that will have the finger pointed at them by public who, presumed the 10p went to British farms when in fact it didn't. You are going to be between rock and a hard place.

Genuinely wonder how Arla are going to deal with this.

Arla cannot under EU laws put the price up just because the supermarkets have said they will pay more when they were under pressure from farmers to do so as it will be seen as market rigging.

As you say it has been thrown on Arla to pay more and if they don't they will have to answer for it, trouble is Arla is owned by the farmers that supply them so they will look bad alongside Arla in the public's eyes if they cannot deliver.

As far as im aware the supermarkets are paying more to ARLA from last Monday but they haven't yet passed on this rise to farmers.

It was a complete knee jerk response from the Unions who wanted to make themselves look good by trying to get the milk price up overnight which looks like it will backfire badly.

 

[llamedos]

There were a few photos on Facebook and Twitter a couple of days back complaining about labelling.
I counted 8 different places on one photo that the pack of lamb had British or a British flag on it. It was glaringly obvious (to me) that one was British and one was new Zealand. Mainly because that's what it said never mind the flags.
If people can't be bothered to look then having a union jack covering the whole pack won't make any difference

Yes, I saw those and agree, there have been similar on here, but there are also the labels which lead the shopper to believe the product is of British origin, using well know Breeds, and it is produced in Uruguay, they are very misleading, as are items 'produced' in Britain, but procured in the EU
This is where I would ask for clarity. Easily done, just use an EU flag, a welsh flag, Union Jack etc etc Before Morrisons went to all Fresh meat from UK it did this with NZ lamb and Beef, so why can others not do it.

What I dont agree with is protesters picking up meats from frozen sections of say Aldi/Morrisons and holding them up as some sort of scapegoat, Both companies clearly state their FRESH meat products are all RT & British, why have a go at them, they are the only two mainstream country wide store who are supporting them.

 

[Gulli]

Yes, I saw those and agree, there have been similar on here, but there are also the labels which lead the shopper to believe the product is of British origin, using well know Breeds, and it is produced in Uruguay, they are very misleading, as are items 'produced' in Britain, but procured in the EU
This is where I would ask for clarity. Easily done, just use an EU flag, a welsh flag, Union Jack etc etc Before Morrisons went to all Fresh meat from UK it did this with NZ lamb and Beef, so why can others not do it.

What I dont agree with is protesters picking up meats from frozen sections of say Aldi/Morrisons and holding them up as some sort of scapegoat, Both companies clearly state their FRESH meat products are all RT & British, why have a go at them, they are the only two mainstream country wide store who are supporting them.

Well why don't people take photos of those packs?
I think the argument loses a lot of credibilty complaining about packs that are clearly British.

 

[Cows 'n grass]

Arla cannot under EU laws put the price up just because the supermarkets have said they will pay more when they were under pressure from farmers to do so as it will be seen as market rigging.

As you say it has been thrown on Arla to pay more and if they don't they will have to answer for it, trouble is Arla is owned by the farmers that supply them so they will look bad alongside Arla in the public's eyes if they cannot deliver.

As far as im aware the supermarkets are paying more to ARLA from last Monday but they haven't yet passed on this rise to farmers.

It was a complete knee jerk response from the Unions who wanted to make themselves look good by trying to get the milk price up overnight which looks like it will backfire badly.

Asda don't care about farmers and neither to the majority of the public, and why should they? I am a farmer and I don't like a lot of farmers I meet.

Asda agreed to pay more because a lot of the protests were targeting them and it was bad PR. Now that they have agreed to pay a bit more the protestors will leave them alone and so long as asda stick to their word and pay 28ppl equivalent on liquid milk and own brand cheese then I suspect it will all go very quiet and never be mentioned in the media again.

 

[cornishfarmer]

Here is a thought...... Why don't arla just say no to morrisons and not supply their milk if MW did the same they would be knackered.
This 10p con won't work.
Morrisons are trying to fight to be the fourth supermarket, no milk and they will be passed by 4 others
Why should it be down to FFA to fight our cause the processors have a role to play too

 

[greengreengrass]

Here is a thought...... Why don't arla just say no to morrisons and not supply their milk if MW did the same they would be knackered.
This 10p con won't work.
Morrisons are trying to fight to be the fourth supermarket, no milk and they will be passed by 4 others
Why should it be down to FFA to fight our cause the processors have a role to play too

What do the processors do with all the milk they withhold from morrisons? Sell it to a fantasy milk buyer for cost of production?
And why is the 10p offer a con? Surely the hard pressed consumer should get the choice to support the farmer. It seems pure hypocrisy when 99% of a farmers inputs are bought on price rather than where it is manufactured.