Farmers need 22p a litre to survive' The National Farmers' Union has warned that the UK dairy industry could collapse before Christmas because farmers are still being paid less for milk than it costs to produce. The report British Milk ­ What Price, is an indepth analysis of why there has been such a steep decline in the cost price of milk over the past three years. NFU deputy president Tim Bennett said Ministry of Agriculture figures showed that the price paid to producers had fallen as low as 14.62p per litre. He said a minimum price of 20p a litre was required to cover costs, while 22p a litre was needed to enable farmers to invest in order to achieve extra productivity. He emphasised: "I cannot exaggerate the predicament dairy farmers find themselves in. "Many could go out of milk production before Christmas, and once they are out, they are unlikely ever to go back." However the report pointed to improvements which Bennett said would realise an immediate increase of at least 2p a litre in producer prices. "But even that would only be the start of a return to a sustainable milk price," Bennett added. The improvements highlighted are a rise in skimmed milk powder and butter prices, a drop in processing costs and a fall in sterling. On the same day that the NFU launched its report ­ at the European Dairy Farming event at Stoneleigh, Warwickshire ­ Asda increased the price it was paying for milk by 2p a litre (see news). {{PROVISIONS }}

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