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SQUARE THE CIRCLE
espite the current state of the industry, the mood at this year’s Semex conference was far from downbeat. In fact it was determined and positive. Michael Dennison, sales manager for Semex UK summed-up the view: “Remember it is always darkest just before dawn and we have to remain optimistic,” he started, before concluding with a well-known, and apt quote: “The struggle we are in today is developing the strength we need for tomorrow.”
D
Rising production means that something has to change, and many speakers believed that the industry had to be more proactive in creating demand for dairy products.
UK farmers fuel EU’s glut of milk… With milk prices on the floor because of overproduction, any UK farmers looking to point the finger of blame at other countries didn’t have a leg to stand on, the conference heard.
Germany, France and the UK have fuelled the EU’s glut of milk the most between 2013 and 2015, with the country expanding the most being the UK, according to Sophie Helaine, from the EU’s dairy outlook
sector. The UK has increased production by 1.4m tonnes over that time period. To put that in context it’s a third of the expansion that the EU’s biggest milk producer, Germany, has seen between 2007 and 2015. This year the EU will deliver 9m tonnes more than it did in 2013 and at a time of falling demand. The EU predicts by 2025 it will be producing 15m tonnes more than 2015.
Emerging markets are here and now…but not without risk Two years ago the general view of China was that it would be the land of milk and honey for dairying. But doing business in China is fraught with risks, warned Semex’s John McDougall, director of international sales and business development for the Semex Alliance.
“People can end-up losing a lot of money because they don’t understand how China works, the first world technologies that can prevail and the attitudes there,” he said.
The market – and those in developing countries cannot be ignored - as that is where the population growth will occur and there will be a lot of opportunities, he said.
“Genetics has a key role and an obligation to help feed the growing populations. Semex is not just a genetics company, not just in the bull business, but part of the food business.”
Donald Moore, executive director of Global Dairy Platform.
Muller to invest more in the UK… Muller was playing its part in trying to make the industry more sustainable by consolidating the fiercely competitive, loss making liquid milk market with the Dairy
Crest purchase. Andrew McInnes, the new managing director of the business which is now called Muller Milk and Ingredients, said the rationalisation would be good for the industry, farmer suppliers, and staff – although redundancies were inevitable to take out cost. “Our aim is to be the biggest and the best fresh milk supplier in the UK. But we have to define what best is.” And he hinted at further investment in the near future here too, with cheese definitely being on the agenda, as the firm’s ambition is to grow from having a £6bn turnover to £9bn by 2020 and with a focus on brands too. “Our long-term ambition is to have the Leppersdorf model in the UK. That is to say a model where all dairy products are produced in this country. Having the whole dairy chain here means we can send milk to the most profitable outlet and the more we can expand the portfolio the more we can manage risk,” he said.
Andrew McInnes, managing director of Muller.
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