Wyke boss slams ‘cheap prices’ after dairy closures
“We are seeing a consolidation of the dairy sector across the board with fewer dairy companies but larger suppliers,” Clothier has told FoodManufacture.co.uk.
About one-in-10 dairy farms had closed in the past three years, according to a new report from the Agriculture and Horticulture Development Board (ADHB).
North Yorkshire was the hardest hit area, with 89 farms being closed, the highest total for any county.
Clothier described the past three years as “the toughest that I have ever seen in my working life.
‘Dumping ground for cheap cheese’
“The EU has been massively oversupplied with milk and even though the UK is not self-sufficient in dairy products, the UK has become a dumping ground for cheap cheese, butter and power.
“The weak euro, weighed down by the southern EU economic problems has made imports of manufactured dairy products come into the UK at eye-wateringly cheap prices that are just not sustainable for UK suppliers and manufacturers.”
Clothier considered UK retailers and foodservice firms had made problems with the dairy sector worse.
“Sections of retail and foodservice have taken advantage of this and adopted what can only be described at times as a ‘Punch and Judy’ buying policy to manufactured products, which has accelerated the exit of UK dairy farmers,” he said
‘Punch and Judy buying policy’
“Now that the milk is down 10% and the pound has weakened dramatically, we will the see that the buying policy will result in more focus on exports and UK food inflation rising rapidly.”
Arla Foods’s David Christensen agreed the market had been “really tough” for dairy farmers in the past two years.
“Supply and demand have been out of balance,” Christensen told BBC News. “Now, ultimately, we can’t alter that supply and demand, but what we can do is try and get more from the market; try and reconnect with our customer, try and drive innovation.”
