FFA made its comments after the group blocked the company’s HQ last night in direct action to protest against falling milk prices paid to dairy farmers.
FFA keen to tackle Muller Wiseman on March milk price
Paul Rowbottom, FFA area contact for Derbyshire, told DairyReporter.com that about 100 protestors blockaded the UK dairy processor’s Shropshire HQ to protest against a lower March milk price.
On February 5 Muller UK & Ireland confirmed that it would cut its standard milk price by 1.75p per litre (ppl) to 24.15ppl, citing a “widening gap” between its price and those offered by rival processors, including farmer-owned co-ops, which it said could affect the group’s ability to compete.
Muller Wiseman said last week that the market for farm-gate milk remains affected by high levels of milk supply from farms and weak demand for dairy products.
MD Carl Ravenhall said the new price reflected drops in the value of cream and butter products, citing the firm’s need to be competitive when supplying products to customers.
Rowbottom said today: “We’ve been speaking to Muller and we’re going to arrange a meeting. So obviously by having the protest we’ve got something arranged and we can talk about the milk price.
“We’ve got Market Drayton shut and we’ve got [another processor] Meadow Foods shut. We’ve probably just over 100 people out. Yeah, numbers were down, we can’t bull it up, that’s the way it is.
“But people are in a mess, they’re worried about their milk contracts. But what can you do? You’ve really only got two big buyers in the market, haven’t you?”
Although Rowbottom conceded that Muller Wiseman are not the worse culprit as regards milk pricing – Dairy Crest, for instance, at 23.09ppl and First Milk Liquid at 21.20ppl, have set lower prices for March, he cited the company as a market leader that might also take over Dairy Crest soon.
'Why spend £17m on a new butter plant?' FFA asks
Criticizing Muller Wiseman’s rationale that weak prices for cream and butter were to blame, Rowbottom questioned why the company spent £17m ($26.1m) on building a new cream and butter plant in Shropshire.
“Last year they said to us that the idea of putting the butter plant in was to take any slack out of the market…They’ve kept encouraging more milk, you’ve got all those farmers on Tesco core contracts and you’re still then encouraging them to produce more.
“Well if you’ve got too much milk why would you encourage people to produce more and put more volume bonuses on – you wouldn’t, would you?”
Turning to the supermarkets and liquid milk, Rowbottom said that using it as a loss leader was fair enough if they paid the processors a decent price, at least until the government imposed a fixed price.
“We believe that it’s quite easy for some of the processors to say, ‘Well, the supermarkets are doing the damage.’ But when we go to the supermarkets they praise us, talk to us and encourage action, because they think some of the processors are to blame,” he added.
One barrier to building value in liquid milk remained the lack of a Red Tractor mark quality mark (administered by UK organization Assured Food Standards, this covers a number of farm assurance schemes) on a lot of UK milk, Rowbottom said, singling out Muller Wiseman as one culprit.
“Foods should be labeled to the British public – if you want to buy British milk, cheese or meat then it should be labeled with that Red Tractor.
“Our product is undermined by the processors – and maybe some of the supermarkets – the products we’ve got are next to none, yet these guys don’t even put the Red Tractor logo on a bottle of milk – how disgusting is that?”
'To find markets for fresh milk we must be able to compete': Muller Wiseman
Although he declined to comment specifically on last night’s action by FFA, a Müller UK & Ireland Group spokesman told this website:"If we are to continue to find markets for the fresh milk products that we make, we must be able to compete against companies, including those owned by farmers, who are paying lower milk prices.
"The market for farm-gate milk throughout the UK and around the world is depressed, but we will continue to meet our commitment to invest in adding value to milk from British farms, and pay a leading price to the farmers who choose to supply us."
On the subject of the Red Tractor logo, the spokesman said: "The decision not to include the Red Tractor mark on fresh milk products was taken a number of years ago. Our view was that our investment is focused on the brands, which are a hallmark for quality dairy products made with British milk. We opted to use flags of the countries from which we buy milk on our fresh milk packaging and to introduce a range of regionally identified packs which link to where milk is processed."