First Milk set to take hard line in price negotiations Britain's newest dairy farm grouping, First Milk, has no intention of going it alone on processing, according to chairman John Duncan. Talks with unnamed processors on prospects for joint ventures are going ahead, he told The Grocer. No early announcements were expected. But the £400m a year farmers' co-op resulting from the merger of Axis, part of the former Milk Marque, and Scottish Milk giving it an 18% share of the GB raw milk market, is expected to go in hard on milk price negotiations with the trade. Among its armoury is the expectation of milk supplies running short later this year following the first summer flush. The situation is likely to be aggravated by FMD. Soundings from the banks have indicated a likely exodus of between 7% and 15% from dairy farming in the first few months, against a norm of 4% a year, unless there are more positive price signals from the trade. Many farmers are expected to use the cash from FMD slaughter compensation to get out and there is no evidence that the rest of the industry, whether individuals, partnerships or share farmers, would be able or willing to take up the slack. Duncan (pictured) remains noncommittal on the prospect of extending the auction system used by the former Scottish Milk Co-op for about 5% of its sales, although he admits it has proved itself in an undersupplied market. Most producers are looking for at least an extra 2p per litre, already put on the table by Robert Wiseman Dairies (The Grocer, last week, p27) for its direct suppliers, and although Duncan says this will not return the industry to profitability it could prove a psychological boost. {{M/E FRESH PRODUCE }}

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