Time to debate mandatory milk contracts, says UFU

Thursday, 20 June, 2019

The Ulster Farmers’ Union says Northern Ireland’s dairy industry needs a thorough debate on mandatory milk contracts. The call comes after a number of milk processors unjustifiably cut May base prices.

Speaking after the latest round of milk price announcements, UFU deputy president, Victor Chestnutt says dairy farmers are understandably angry. “One processor has dropped by base price by 0.50p per litre, putting the base price below 25p per litre. We can see no justification for this drop, if anything, the market is signalling prices should be rising.”

The UFU says with dairy commodity market strong since the beginning of the year, it is increasingly frustrated that processors continue to blatantly refuse to share the positive returns with primary producers. “It is this kind of unscrupulous action by dairy processors that highlights why the industry needs an honest and frank debate round mandatory milk contracts. If mandatory contracts were in place, this unjustified cut to the base price could not have happened,” said Mr Chestnutt.

DEFRA recently confirmed it will shortly launch a UK wide consultation on mandatory milk contracts and Mr Chestnutt says the recent unwarranted base price reductions demonstrate now is the time to have this debate. “Primary producers in Northern Ireland are crying out for transparency when it comes to milk pricing. Now is the time for a healthy debate. It is clear we need more transparency in the supply chain and to bring a stop to unexplained and unfounded drops in farm gate price,” he said.

The UFU and its UK farming union counterparts have already begun discussing what mandatory milk contacts could mean for the dairy industry. The UFU is also urging processors to engage fully in the mandatory contracts debate.