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Milk Prices – New regulation to help dairy farmers

Image of black and white cows in a field for the Milk Prices Blog

In the world of dairy farming, the struggle for fair milk prices has long been a challenge. However, there’s a glimmer of hope on the horizon as the UK government gears up to introduce new regulations aimed at promoting fairness and transparency in the dairy sector. This initiative, announced in July last year, comes as a light at the end of the tunnel for farmers who have been grappling with fluctuating prices and uncertain futures.

The overriding principle behind these regulations is clear: to ensure that short-supply contracts in the dairy sector are fair and transparent, with farmers receiving a just price for their produce. While the process of implementing these regulations has been slower than anticipated, the importance of getting it right cannot be overstated. As Alistair McNabb, vice president of NFU Scotland, rightly points out, the regulations must be fit for purpose, fair and transparent – something that the industry desperately needs. He states, “While progress on milk contract reform is taking far longer than any Scottish dairy farmer would like, it remains imperative that the draft regulation, when eventually laid, is fit for purpose and delivers the fairness and transparency across the whole UK that everyone is seeking, including the government“.

Key industry players, including the NFU and Dairy UK, have been actively involved in the development of these regulations for fair milk prices, signalling a collaborative effort to address longstanding issues within the sector. The phased implementation of the new regulations over a two-year period underscores the complexity of the task at hand but also reflects a commitment to thoroughness and effectiveness.

One of the primary goals of these regulations is to mitigate the severe fluctuations in milk prices that have plagued dairy farmers for far too long. The disparity in prices, ranging from 50p to 35/37p per litre, has made it challenging for farmers to anticipate cash flow and plan for the future with confidence. By establishing clear guidelines and standards for pricing, the hope is that farmers will be able to operate in a more stable and sustainable environment.

The consultation process, which included input from various stakeholders, has been instrumental in shaping the direction of these regulations. The summary of responses reflects a broad consensus on the need for change and a shared vision for a fairer, more transparent dairy industry.

As we look ahead to the implementation of these regulations, there is cautious optimism among farmers and industry experts alike. While challenges undoubtedly lie ahead, there is a sense of determination to overcome them and pave the way for a brighter future for the dairy sector.

The forthcoming regulations represent a significant step forward in the quest for fair milk prices. By fostering collaboration, transparency, and accountability, they have the potential to transform the dairy industry and empower farmers to thrive in an increasingly competitive market. As we await their full implementation, let us remain vigilant and committed to the principles of fairness and equity that underpin this vital initiative.

If you need any agricultural legal advice, contact our team here.

John Gibbons

Solicitor, Head of Agriculture

John is Head of the Agriculture Department and qualified as a Solicitor in 2001 having attended Staffordshire University Law School.John says “Our role in the agricultural department is unique in that it involves agricultural law with business, property, and estate planning. It is very interesting and rewarding.In 2016, John became a Fellow of the Agricultural Law Association by completing the examinations in London.John attends annual specialist conferences and continual profession development courses to keep up to date with the latest legal developments.