Low prices are forcing dairy farmers to intensify.

What’s going on in dairy?

The Food Ethics Council has heard from dairy farmers that were subject to bullying practices and given a matter of minutes to sign a new contract, writes Abi Williams.

As the cost of milk falls in supermarkets, dairy farmers are bracing themselves for another tough year, with some deciding to pack up altogether. You may have heard of some dairy herds going up for sale, or rumours of milk prices being unsustainable. But when it’s still such a household staple, what exactly is going on in dairy?

While many are feeling overwhelmed trying to stay financially afloat, there is real appetite for change in the sector – but this needs to start with a fair deal for farmers.

Over the past three decades, the UK dairy industry has become bigger, more ‘efficient’ and more connected to the global marketplace. These changes have pushed many UK dairy farmers onto a treadmill of intensification, where stepping off can seem near impossible. Since 1990, average herd sizes have doubled and since 1975, milk yield per cow has increased by 100 per cent. Soaring input costs alongside limited increases in farmgate milk prices have pushed many small-scale farms out of production and others onto a pathway focused on increasing yield, rather than quality. This has had a major knock-on effect for animal welfare, the environment and the physical and mental health of farmers and farm workers themselves.

These changes have pushed many UK dairy farmers onto a treadmill of intensification.

Dairy farmers are now leaving the industry – in the past 25 years, producer numbers have dropped by two thirds. Data is yet to be published, but we have also heard concerns that some organic dairy farmers are either quitting altogether or converting back to conventional dairy systems.

Alongside the pressures to ‘get big or get out’, relationships between farmers and some processors and retailers have become increasingly strained, underpinned by unfair contracts and power imbalances within the supply chain. The Food Ethics Council has heard from dairy farmers that were subject to bullying practices and given a matter of minutes to sign a new contract. Other issues are around exclusivity clauses preventing farmers from selling milk to other buyers, including their local communities. Milk prices are often dictated by processors with less than a week’s notice, and some farmers have to give 12 months’ notice to end a contract. With limited routes to market, farmers often have little choice in who they can sell their milk to, giving the power to buyers to call the shots.

Contracts have recently been in the spotlight as one solution, with the government announcing that there will be a new Dairy Code of Conduct. Although long overdue, this code will act as an important signal to farmers they are not alone on the journey to better dairy.

Other changes needed include ensuring a fair price for milk, funding that supports nature-friendly farming, more opportunities for farmers to connect with the public, a marketplace that values milk as more than a commodity, plus more local public procurement opportunities.

Despite the pressures those in the sector are under, there are examples that we can take hope and inspiration from. For example, the rise in successful cow-with-calf systems, the creativity of farmers selling via milk vending machines and converted shipping containers, a growing interest in the use of regenerative systems and more processors explicitly focused on collaboration and fair purchasing practices. The future for dairy is far from black and white.

This opinion piece was originally published in the summer-autumn 2023 ‘Fairness’ issue of Wicked Leeks, out now. You can read the full magazine online for free.


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