Radical shift in dairy prices hits St Neots farmer

A national crisis in the dairy industry, which has sparked protests by farmers across the country, has also seen the amount of dairy farms in the region halved in 10 years.

The National Farmers’ Union says the number of dairy farms has fallen from 235 in 2003 to 112 in 2013 in its East Anglian region, which includes Cambridgeshire.

According to figures from the NFU, the average price per litre of milk has fallen from 31.66p in June 2014 to 23.66p just a year later. However, the average cost of producing a litre of milk is about 30p, with some farmers being paid as low as 15p per litre.

The NFU’s East Anglian representative Brian Finnerty said: “The price the farmer is being paid is lower than the cost of production. In the longer term, that’s just not sustainable.

“If this continues we’ll see more farms going bust, more herds being sold and more of them going into other types of farming.”

Third-generation dairy farmer David Herdman said: “There’s been a radical shift in the profitability of the business. We’ve had three good years, but we will be making a loss in this financial year.”

Gaynes Farm in Great Staughton near St Neots has been in the family since 1929, but David, who runs the farm with his brother Kevin, said: “We’d based our figures on 28p a litre this year, but it’s down 4p. There’s always been volatility in the market, but not to the extent we’re now experiencing.”

At a crisis meeting on Monday (August 10) in London, farming leaders called for urgent talks with the government and for retailers to cut their margins.

Waitrose, Marks and Spencer, Tesco, Sainsbury’s and the Co-op have agreements in place to ensure farmers are paid more than the cost of production. No such agreements are in place with the other supermarkets.

After a meeting with farming unions on Tuesday (August 11), however, Morrisons announced it would be introducing a new range of milk, which will have a 10p premium that will be passed directly back to dairy farmers.