Signs point to Dairy Farming Recovery

With increased visibility of the dairy farm crisis, the national and global community, both within the industry and outside it, are realising that something has to change.

No doubt about it, it’s been a tough time for those in the dairy industry. The British public are showing their sympathy and solidarity with dairy farmers, with 82% saying they would pay more for their milk to support them according to AHDB.

But after months of financial struggle, protests, and initiatives from supermarkets, including Morrisons’ ‘Milk For Farmers’, things may be looking up for the milk industry.

First there was an increase in The Global Dairy Trade (GDT) price index, which measures milk commodity prices, of 13% – a “promising figure” according to AHDB senior analyst Luke Crossman.

Meanwhile over in New Zealand, co-op Fonterra has risen it’s estimation on the price paid to farmers by the equivalent of 2.1p to 20.1p/litre.

While Fonterra chairman John Wilson did not expect this increase to steady a volatile market right away, he says progress is on the horizon

“Current milk prices will remain at unrealistically low levels, but have started to improve as global demand and supply continue to rebalance.”

What does this mean for British Dairy Farmers?

Support continues to mount among UK consumers, with just under half questioned saying they would consider switching to a retailer that sells British dairy products only.

46% would be willing to pay at least 11p more on a 4 pint container according to AHDB’s survey; a significant admission given that British consumers on the whole have become more price conscious since the 2009 recession.

This willingness to pay more may not in itself be enough to drive higher prices and more sales, but with more emphasis placed on freshness, origin and ethics, it seems the veil has been lifted on the plight of UK dairy farmers. The general consensus among the industry and the public is that something has got to change. With rising GDP and a price increase forecast from dairy giants, it looks like it will for the better.

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