Dairy farmers in Melton say moves by supermarkets to guarantee them a minimum price they will be paid for supplying milk are not enough to help them sustain a business with some of them in a bad enough state that they may soon fold.
That was the warning sounded by the town branch of the National Farmers’ Union (NFU) this week after Aldi, Lidl and Asda said they would now pay at least 28p for every litre of milk they get from a farmer and Morrisons guaranteed a price of 26p in a pledge of support to British farmers.
Waitrose, Tesco, Marks and Spencer, the Co-op and Sainsbury’s have indicated that they already pay more than the 30 to 32p it costs farmers to produce each litre of milk at a time when a reduction in worldwide demand and an over-supply has severely depressed prices.
Government ministers are also looking at ways of helping dairy farmers after holding talks with farming leaders this week but Melton NFU say members are genuinely fearful for their future if prices do not soon recover.
Chairman Stephen Eggleston said: “Supermarkets guaranteeing a minimum price for milk is not nearly enough for our dairy farmers.
“There are so many different contracts farmers have with dairies but the farmers who are getting higher prices are still struggling and the ones with lower contracts are doing even worse.
“Our members are saying that the price they are being paid for milk needs to be at least 28p to 30p a litre for them to make a living but some of them are getting as low as 21p.
“The price was quite a bit over 30p only 18 months to two years ago so it was reasonably good for dairy farmers around here back then but there are one or two now who are struggling and it wouldn’t take much for them to go out of business.”
Many dairy farmers in Melton supply milk to Long Clawson Dairy, including Alan and Jane Hewson at Belvoir Ridge Dairy, based at Cross Roads Farm in Eastwell.
They diversified by setting up a milk vending machine which sells direct to the public at a higher price than they get from retail sales.
The Hewsons sell around 30 litres a day in this way but they have seen the price they get paid for supplying the dairy drop by a huge 8p a litre in the last year, which is a fall of about 25 per cent.
Mr Hewson said: “What we gain from sales from the machine is being swallowed up by being paid less for the bulk of our milk which goes to the dairy.
“The price has got continually worse over the last year and I can’t see it changing in the foreseeable future.
“It’s gone down by a quarter and if you imagine your wage going down by a quarter you can see what effect that is going to have.”
The couple have further diversified by producing Colwick cheese from the milk of their herd of Red Poll cattle and sales were boosted when Jamie Oliver featured it on an episode of his Channel 4 TV show Jamie And Jimmy’s Friday Night Feast 18 months ago.
Mr Hewson added: “Sales of the cheese are going well but that has to stand on its own because it has its own labour and production costs.”