Minister's pledge to investigate dairy crisis

Mr Paice will use his next dairy supply chain forum to look into the industry which is currently losing an estimated two dairy farmers a week who are quitting in the face of ever-diminishing returns.

His pledge came in response to a challenge by National Farners' Union president Peter Kendall who said an urgent discussion between the nation's dairy processors and the Defra minister was needed to explain the current situation in the sector.

"It is clear to me, and the countless dairy farmers across the country who are trying to make a living, that this market just simply isn't working," said Mr Kendall.

"Milk processors are carving each other up – at the expense of all dairy farmers – by making increasingly reckless undercuts in the market.

"At the same time, supermarkets and other liquid milk customers are being extremely short-sighted by paying a milk price so low that some farmers aren't even meeting their own costs of production.

"If these customers took the time to look over the fence at what's happened to cheese prices, they'd realise that cheese production will soon be a more attractive and profitable market for milk.

"This will leave the liquid market starved of supply. There has to be something profoundly wrong in the market place for these things to be happening.

"I am committed to investigating a market which clearly isn't working and the minister shares our concerns.

"I believe money has been made but not shared back down through the supply chain to the farm gate.

"This cannot continue or we face seeing less investment, lower milk production, fewer farms and more and more imported dairy products on our supermarket shelves.

"I would urge him to remember Defra's newly published business plan; it is quite clear about what the government wants for farming."

The minister's number one priority is to support and develop British farming and help enhance the competitiveness of the whole food chain.

That includes dairy farms.

"For our part the NFU will continue its work to unravel, scrutinise and expose what is going on in our dairy sector and engage directly with retailers and processors to push for better farm gate prices, better contracts and better behaviour that won't leave dairy farmers vulnerable to downward price pressures or exposed to all of the market risk."

The announcement comes ahead of the NFU's fifth Northern Dairy Conference, due to be held in Skipton on Tuesday.

The union's north east dairy adviser Adam Bedford said he was finding farmers to be increasingly concerned about the future.

"With such tough operating conditions, we are continuing to see significant numbers of dairy farmers leaving the industry and it has even been suggested that we are close to losing critical mass within the dairy sector," he said.

Newly-elected national dairy board chairman Mansel Raymond, will make a return visit to the region for the conference and he will be joined by leading nutritionist Professor David Beevers, Arnaud Petit, director of commodities and trade at Copa-Cogeca (the Brussels body representing the combined farming unions in Europe), and group commercial director at Medina Dairies, Terry Ziton.

The conference will take place at The Coniston Hotel at Coniston Cold, Skipton starting at 10.30am.

Anyone wishing to attend can book a place by calling 01904 451550.