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their promises’. He was therefore unsure as to whether the price increases could be described as ‘a milestone’. It was possible to say that, in consequence of the price increases, the industry might be turning a corner but this ‘is not unexpected considering there is a bit more money in the system’. Given many compounders’ interests as far as milk production


is concerned this analysis, stemming as it does from a respected institution, is a bit depressing. Both milk producer and buyers do, however, need to get their heads around one crucial fact, the cost of milk production is still going up. The NFU has recently reported that it had risen to 31.5 pence a litre. This means, if the NFU’s calculations are correct, that the average farmgate milk price is still 2.5 pence below the cost of production. The increases in milk prices will have been welcomed by many but milk prices of around 29 pence or even 29.5 pence represent an average around which there will inevitably be a fair margin of variation – in other words, there will be some milk producers who will not be achieving the average milk price. Equally, and as those who were present at a spectacularly rowdy meeting in July will remember, Jim Paice was, at one point during the proceedings, booed for suggesting that farmers should lower their cost of production. I understand that, in addition, the so-called dairy coalition


2012 178x124 liggend :Opmaak 1 18-09-2012 15:24 Pagina 1


is aiming to secure a back-payment in the shape of a refund of the price cuts that were introduced by the processors in May and June. More importantly, we need to ensure that the voluntary code, announced at Birmingham’s National Exhibition


Centre, is designed genuinely to provide greater transparency in dairy contracts. I understand that the draft Code is now being scrutinized by the competition authorities. Meanwhile, and ironically, French dairy producers have


lashed out at the move by French dairy firm Lactalis to lower the price it pays farmers for milk. The company announced on 20 September that it would lower the price it pays its milk suppliers to one euro for five litres of milk with the reduction coming into effect from 1 October. This implies a per litre price of 20 cents which, as of the time of writing, is equivalent to 16 pence. Has Lactalis not taken account of what happened when their British colleagues tried to reduce milk prices? Maybe Farmers for Action would like to offer their French colleagues a little advice.


CEREAL QUALITY 2012 AHDB/HGCA has just produced their second assessment of cereal quality from the 2012 harvest. It needs to be borne in mind that the data were collated from


35,599 samples of wheat and 21,929 samples of barley received up to 17 September, thus not reflecting the entire harvest. In addition, and as regards wheat, the survey is biased towards South-East and Eastern regions of Great Britain with 72 per cent of wheat samples originating from these areas. This reflects these regions’ earlier harvest. As far as wheat is concerned, the estimates are also weighted towards NABIM Group 1 and 2 varieties which make up 46 per cent of all samples as these are


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