Steps must be taken to ease the short-term pain of dairy farmers,
long-term lessons must be learned from the mistakes of First Milk and a new ‘Team
Scotland’ approach to sales of Scottish dairy products must come into play if
the sector is to thrive, according to The Scottish Parliament’s Rural Affairs, Climate Change and Environment Committee
Following its urgent inquiry into milk pricing and the current dairy crisis, the Committee has highlighted key recommendations for the Scottish dairy industry’s profitable and sustainable future in a fifteen-page letter to the Cabinet Secretary for Rural Affairs, Food and Environment, Richard Lochhead MSP.
Rob Gibson MSP, Convener of the Committee said:
“It is crucial that Scottish and UK Governments address the short term pain faced by many in the industry. Whilst we looked at the overall situation we were particularly concerned at the decisions made by, and the management of, First Milk which have led to severe problems for the farmer producers who are members of that co-operative especially in Bute, Arran and Kintyre. Lessons must be learned and any support offered to First Milk, which might usefully be based on our recommendations regarding the company, must not be undermined by repeating its previous failures.”
“More generally, whist the Committee was horrified at some of the information it took in evidence from the UK Groceries Code Adjudicator we were impressed by present actions from many of the supermarkets in their direct relationship with dairy farmers and we hope that their presence at the Committee (after initial reluctance by some) will set the standard for future engagement and co-operation in securing a “team Scotland” approach to dairy products.”
Mr Gibson added:
“Such a co-operative approach will be greatly assisted by the planned launch by the Scottish Government of a Scottish brand later in the year not least because, as the Committee learned, it is dairy products from Denmark and England that are presently the market leaders in key parts of the sector. We must change that and we will only do so if we can have stability in high quality production accompanied by better marketing and greater innovation.”
The Committee’s letter highlights a range of issues, including:
- The Committee is of the view that the prices paid by supermarkets for milk is a factor in the overall health and management of the dairy industry in Scotland.
- The Voluntary Code of Practice between producers and processors has greatly increased transparency and trust between those two links in the supply chain. However, there continues to be a lack of transparency of prices paid between processors and supermarkets which must be addressed if trust is to be improved between producers, retailers and consumers. Customers have a right to know how much the retailers they buy their dairy products from have paid to the producers of those products.
- The success of the Scottish dairy sector in the medium to long term lies not only in developing export markets, but also in shifting the pattern of sales in Scotland to home grown produce. There is significant scope for improving the amount of Scottish dairy products sold in Scotland, particularly premium products.
- Calling on the Scottish Government to look sympathetically at ways of reducing the burden of transportation costs for remote and island dairy farmers.
Mr Gibson also highlighted evidence received from Christine Tacon, the UK Groceries Code Adjudicator on issues she was seeking to tackle with supermarkets.
Mr Gibson said:
“The Committee was appalled to hear from the UK Groceries Code Adjudicator of the matters relating to supermarket practices which she is currently pursuing. Some of these affect the dairy sector. Supermarkets must work with the Adjudicator to rid Scotland of any ethically reprehensible practices, as well as working with the industry to create a more sustainable, equitable, and profitable dairy sector in Scotland.”
The Rural Affairs, Climate Change and Environment Committee’s (RACCE) letter to the Cabinet Secretary for Rural Affairs, Food and Environment, Richard Lochhead MSP can be accessed here.
RACCE’S inquiry into milk pricing commenced on January 28th 2015.
The Rural Affairs, Climate Change and Environment Committee (RACCE) scrutinises policy proposals relating to rural affairs, climate change and the environment. It comes to a view after taking comprehensive evidence from, and engaging with, a wide range of stakeholders ‘on the frontline’ and applies authoritive, expert, effective and influential scrutiny to policy.