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Farmers in Milk Threat Over Dairy Payments

Posted on: Friday, 11 November 2005, 18:00 CST

FARMERS last night threatened to cripple milk supplies after Scotland's largest dairy warned it will be forced to cut the amount of money it pays them.

Revealing a 22 per cent drop in profits, Robert Wiseman Dairies said it currently pays farmers 0.6p more per litre than its rivals a figure it could not sustain.

The price is fixed until January 2006, but after that the East Kilbride-based company will be forced to reduce it in a move which will affect around a third of all Scotland's dairy farmers.

Last month farmers, angry at low prices paid to them by supermarkets, withheld milk supplies for three days. As Wisemans supply 1.3billion litres of milk a year, a fifth of the UK market, farmers warn a similar sustained action could cause shortages in the shops.

After revealing that pre-tax profits fell to Pounds 12.1million in the six months to October 1, the dairy's chairman, Alan Wiseman, said: 'Given the competitive marketplace in which we operate, the current level of premium cannot be maintained.' He blamed soaring fuel and raw material costs for the fall in profits.

Willie Lamont, of the NFU said: 'Wiseman says it is paying a significant premium but a bad price is a bad price. With a Wiseman farmgate price of 19.6p per litre, against a cost of production at 19p, that means a net income of Pounds 6,000 for the average farm to support the family and reinvest in the business.' Fiona Moriarty of the Scottish Retail Consortium played down the farmers' threat. 'It is highly unlikely there is going to be any impact on food availability and you are not going to see a huge sudden increase in prices,' she said.

Source: Daily Mail; London (UK)

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