It seems that the interdependency of the retailers and the producers has been recognised. If farmers have to sell their milk for less than it costs to produce it, they cannot continue in business. Is common sense invading the ‘market’?
July 21, 2012
July 6, 2012
Here we are in York for the General Synod and milk is back on my agenda. And that isn't a comment on the nature of the Synod's agenda for the next five days. It follows on from a bit of a rant I had recently about the price of milk.
I couldn't believe that the price farmers get for the milk they produce (a) was so low and (b) could be changed without warning or redress by the body that buys the stuff for re-sale to the supermarkets and other outlets. One farmer told me he stood to lose £20,000 this year because of a 2p drop per litre in June.
And now this. Dairy farmers are considering taking action into their own hands as a further reduction of 1.7p is being imposed from August. You can read the farmers' response here.
Having visited another farm up in the Dales last week, I am more aware of the economics of farming and the problem of getting a younger generation to take on the family business when the life is so hard and the rewards so few. If we think farming is necessary for our economy and the nurture of our landscape, we'd better take it a bit more seriously.
We could start by asking why the farmers are getting milked.
June 20, 2012
The last three weeks have seen me in Kazakhstan (interfaith conference), Brussels (round-table with Herman van Rompuy), then Dresden (preaching at the Frauenkirche). All good gigs, but all it does is build a backlog of work at home. It has also squeezed out any blogging – or any creative thought, for that matter. And I’ve missed almost all the football in Euro 2012. And I forgot to change my fantasy team in time and am now doing rubbish.
Of course, had I had the space to do so, I would have blogged about women bishops, Church of England PR, the Telegraph’s useless commenting on the C of E’s input to a consultation on Europe (don’t these guys bother to read the originals before launching their self-important second-hand opinions), Euro 2012, the poignancy of preaching in Dresden’s Frauenkirche (especially when the tourists leave in droves before the sermon), the Euro-crisis and Angela Merkel, the Greek elections, developments in Egypt, destruction of a church in Sudan, the future of the Diocese of Bradford (in the light of proposals to dissolve it), lots of other stuff, and the price of milk.
Actually, I really did want to write about the price of milk. I was shocked to hear further evidence recently of how the power of the supermarkets to control milk prices now makes a bottle of water more expensive than a pint of milk. And who gets screwed? The farmers. What do you make of this:
- Currently dairy contracts allow milk purchasers to make significant changes to the terms and conditions in the contract and lower the milk price paid, often with less than 30 days’ notice, whilst the producer is often locked in to the contract for the next 12 to 24 months. No wonder the National Farmers Union (NFU) is calling for (a) clear price determination, and (b) shorter break clauses / right to terminate. (The NFU believes this is not solely about milk price – it is about establishing a functional market place which has true liquidity and therefore incentivises milk purchasers to offer a competitive milk price.)
- The farmer should know at any time what their milk price is. Isn’t it rather shocking that they don’t? Shouldn’t the price be specified in the contract between purchaser and provider? Isn’t that rather obvious? At the moment many milk buyers have the ‘discretion’ to change the price a farmer receives at will and potentially retrospectively.
- Recently farmers in my neck of the woods were informed that the price they received for each litre of milk would be reduced by 2p. The average farmer around here works that out around a staggering sum of £20,000 per annum. One farmer in my diocese stands to lose £10,000 this year – from a small farm.
What I find amazing is that (a) this can happen without the farmer having any recourse to negotiation and (b) that most of us drink the white stuff without any recognition of where it comes from or who pays the real price for it.
I’m no expert, but I now understand why the General Synod of the Churhc of England has so often banged on about the power of supermarkets. I’m not against them – after all, I use them. But, there is an issue of economic and social justice here. And we can’t blame the cows.