Environment Minister pledges to "stand alongside dairy farmers" as funding is announced

The new scheme will see eligible farmers able to claim up to £10,000 each, covering 70 per cent of their lost income during April and May.

Mr Eustice said: “Our dairy industry plays a crucial role in feeding our nation and we are doing all we can to ensure they are properly supported during this time.”

The dairy sector, which collectively produces more than 40 million litres of milk a day, has been particularly hard hit by the closure of bars, cafes and restaurants.

The new fund is part of measures aimed at securing the future of the industry, which NFU and dairy leaders had warned was in danger of being lost.

Along with recent moves to temporarily relax some elements of the UK’s competition law and a campaign to champion milk consumption, Mr Eustice said they were working to ensure the industry could continue to operate and sustain production capacity without any impact on animal welfare.

“We’ve already relaxed competition laws so dairy farmers can work together through the toughest months,” said Mr Eustice,

“But we recognise there is more to be done. That is why today we have kick-started a new campaign to boost milk consumption and have announced a further package of funding.

“We will continue to stand alongside our dairy farmers through this difficult period.”

The dairy sector is the UK’s largest farming sector, with milk accounting for 16.85 per cent of total agricultural output in the UK in 2018. Since the start of the coronavirus outbreak, the dairy industry has faced the challenges of excess milk, falling prices, and reduced demand from the hospitality sector.

Mr Eustice said that while many farmers have already re-routed their milk supplies to retailers and supermarkets – which have seen increased demand in recent weeks – the fund would give the farmers in the greatest need the financial assurance to ensure they can remain operational, sustain production capacity and continue to meet animal welfare demands.

Industry-wide lobbying for help to support dairy farmers has been taking place since lockdown brought the loss of some of their biggest markets. More than three quarters of all dairy farmers were affected by a drop in milk price or delayed payments following the loss of food service and hospitality outlets which took around eight million litres of milk every week.

NFU president, Minette Batters, who spoke at the Environment, Food and Rural Affairs committee earlier this week, where she said she was “hoping and praying” the Government would announce financial support for the sector, welcomed the funding.

“Thankfully, the Secretary of State has heard our calls for help and is stepping in to prevent a catastrophe for the dairy sector,” she said.

“This package of support from Defra will help many dairy farming businesses facing an uncertain future as a result of the impacts of the coronavirus outbreak.

“We know that the dairy sector is just one of many that have been affected by coronavirus, but we appreciate the hard work Defra has put in to secure this much-needed financial support for many dairy farming families who face losing their businesses.”

NFU dairy board chairman, Michael Oakes, said the NFU and industry representatives had worked “relentlessly” over the past few weeks to ensure support reached dairy farmers facing immediate financial hardship.

But he warned that while the support package will be helpful for dairy farmers in immediate need, a combination of measures were needed to ensure the industry’s survival in the medium to long term, making particular reference to contractual protection.

“This support package will be helpful for those farmers who are currently under considerable financial strain,” he said.

“But we believe a combination of measures are needed in order to stabilise the industry’s viability for the medium and long term.

“Dairy farmers need much better contractual protection than they currently enjoy and that needs to be examined by government as a matter of urgency.”

CLA President Mark Bridgeman said the funding was welcome but stressed it was essential the funding was easy to access and quickly received. “It’s important we support our dairy farmers so they are still able to produce milk for doorstep delivery, retail market and processing in the future when markets return to normal.”