Union Committee Supports Simplest Milk Fund Option

NFU Scotland has given its support to the simplest option suggested by Scottish Government on how the EU’s proposed dairy fund should be distributed amongst the nation’s dairy farmers.  This follows discussions at the Union’s recent Milk Committee meeting, which took place at Ingliston, Edinburgh yesterday (Tuesday, 26 January).

In November 2009, EU finance ministers, as part of an economy wide package of financial measures, agreed short-term support in the form of a €300 million 'Dairy Fund'. The aim of the fund is to support European dairy farmers following a traumatic year for the dairy sector.   Scotland’s share of the fund amounts to around €2.8 million.

The Scottish Government is currently looking at options on how this money could be distributed to producers.  NFU Scotland favours a direct payment of around 0.2 pence per litre, depending on exchange rates, to be paid based on the farm’s milk production during the 12-month period from 1 October, 2008 to 30 September, 2009.   If adopted by the Scottish Government, the payment to the average Scottish dairy farmer would be around £2000.

Milk Committee chairman, Jimmy Mitchell said:

“While the sums of money involved are relatively small, every little bit helps as the majority of dairy farmers are still struggling to achieve an acceptable and fair price for their milk.

“After a good debate at committee which looked at a number of options, such as levy payment holidays and higher payment levels for small producers, members supported option one in the Scottish Government consultation. This would divide out the EU fund based on milk produced between October 2008 and September of last year.   In view of the tight timescale involved in paying out the fund, the relatively small sums of money to be paid and the need for simplicity, this is our preferred route.

“The fund, while welcome, is a bit of a sticking plaster and it will not deflect our attention away from our wider agenda of securing a better milk price from the marketplace for our members.  Wholesale prices for cheese, butter, cream and milk powder remain significantly higher than in the same period a year ago and demand for fresh liquid milk remains buoyant.  Despite these positive signs, very few milk producers in Scotland have seen any significant change to their milk price in recent months and we continue to meet and discuss with Scotland’s milk purchasers, highlighting the urgent need for farmgate prices to improve.” 

Notes to Editors

• A copy of the Scottish Government consultation on the method of distribution for the UK’s share of the €300 million EU Dairy Fund can be found at: http://www.scotland.gov.uk/Publications/2010/01/EUDairyFundconsultation/Q/EditMode/on/Page/2

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Contact Bob Carruth on 0131 472 4006