Milk is very familiar - from the splash in your tea to the froth in your latte or what makes your cornflakes digestible. You, like me, may have grown up with milk but rarely reflect on how incredible an edible it is: as natural as honey; rich in calcium and vitamins; replenishable and surely sustainable? All you need is grass and cows. And it’s extraordinary good value. Currently around 40-45p a litre, it’s cheaper in supermarkets than bottled water, perhaps too cheap.
Dairy, dairy, quite contrary
Milk prices are in the news. There is a glut in world markets linked to a fall-off in demand from China and, because of their EU import ban, Russia. Processors are cutting what they pay to farmers for their raw milk. Supermarkets are waging a price war with four pints of milk for a £1 or less as one of their loss leaders. Prices paid to dairy farmers have fallen in the past few months from around 34p per litre last October 2013 to 30p this year (Dairy Co). These savings for us, drinking around 70-80 litres each a year, are tens of thousands of pounds of income lost to farmers whose herds produce millions of litres. So these recent price cuts are a serious threat to their survival. As a result, we face a further haemorrhage of dairy farmers from the industry, driving the total number below 10,000 in England and Wales for the first time. The number has been falling steeply: there were more than 35,000 UK dairy farmers in 1995 and then just under 15,000 in 2011. How much further could it go?
The crisis in the dairy industry was discussed at two events I’ve been to recently: a parliamentary select committee taking evidence from farm leaders and ministers and a World Animal Protection meeting on the future of pasture-based dairy farming. The first left me pessimistic; the second gave me cause for optimism. Both supplied a wealth of insights into this complex but fascinating business.
At the select committee farmers leaders Rob Harrison (National Farmers Union), George Dunn (Tenant Farmers Association) and David Handley, (Farmers for Action), were unanimous in their fears for dairy farming and further severe loss of farmers if milk prices aren’t raised. Farmers don’t know who makes the profit, but it’s clearly not them. They are in many cases selling below their cost of production. The role of global markets was questioned: how can we be as exposed as other countries when we consume 85% of our own milk here? How can our farmers be worse off than those in New Zealand which exports 85% of its milk? Should dairy farms grow still larger to drive down costs and be more competitive? But, for the farm leaders, this made little sense. Producing more for less money with falling milk prices means no more income to farmers and, if they invest to grow, they can’t repay their borrowing for the investment they need to make in equipment, sheds and livestock.
There was little confidence from farm leaders in Government’s faith in the market and current policies. The supermarket ombudsman Christine Tacon, also called as a witness, clarified that she was helpless to intervene on prices paid to farmers – not part of her remit – though she could look into relationships between farmers and supermarkets supplied directly or processors and supermarkets.
The World Animal Protection event offered hope that the global market for dairy is a growing one with many export opportunities for farmers in the future. World demand is expected to grow by 20 billion litres a year, compared with UK production at around 11.1 billion litres in the past year. Most compellingly, two visions of the future of dairy farming in the UK were presented – a shift to much larger scale indoor intensive systems or pasture-based with cows outsideon a smaller scale.
The first, often seen as the ultra-efficient future, would mean mega farms with upward of a thousand high yielding cows in one unit zero-grazing – meaning they never go out to graze in the fields but spend their lives indoors munching fodder brought to them with added high protein rations. Yields can reach 10,000 litres per cow per annum and more. Wastes can be processed in anaerobic digestion plants. Animals can be well-cared for, comfortable and possibly a little pampered in their sheds with their fans and soft beds. The model can be highly productive but relies on high inputs and costs. Oh, and the cows tend to have short lives.
Two farmers with impeccable credentials presented the alternative - BBC Farmer of the Year Neil Darwent and Farmers Weekly Farmer of the Year Robert Craig. They see a different future for dairying and one, on the whole, far more appealing to me. Their vision relies on making the best use of grass. For Robert Craig the key is good grass management to get the most from grazing cows. They produce less milk – his at around 5 to 6,000 litres per cow per annum – but, without expensive fertilisers and bought in feeds, costs are lower and his business profitable as well as sustainable. For Neil Darwent, the future is also grass-based and economically viable. He mentioned not only good use of grass but the need for different genetics in cows. This is not about maximising milk production, but breeding animals that are easier to manage, more robust and that produce beef too. He cares passionately that animals have freedom to graze but also that we value milk better for the quality product it is instead of reducing it to a characterless commodity, with prices driven ever lower. Neil is promoting his vision through his free-range dairy campaign.
So, dairy is both complex and simple – a little contrary really. In the end it could all come down to cows and grass if we make the right choices and go for the pasture-based option. We do have the power as shoppers to choose the right product but we need the right information to make the choice. At the moment, it’s impossible to tell if your pint comes from a mega dairy or one of thousands of smaller and more traditional farms that send their cows out to graze. That’s why I will be supporting Neil Darwent and free range dairy. If it catches on we should have the information and the right labels to vote with our wallets.
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