Farmers have never gained sustained benefit from successive retail milk price increases and therefore should not care too much if prices come down. This sounds nice, but any devaluation of a product such as liquid milk sends completely the wrong signals to the market. It puts pressure on sales of added value products and increases competition in the middle ground. More importantly it gives rise to fears that retailers will come to milk processors looking for a better deal.
Thankfully recent increases in retail liquid milk prices will relieve some of the pressure, but it is essential that changes are made urgently to the domestic supply chain.