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NFU Says Collaborative Supply Chains Essential

09 October 2008
National Farmers Union

UK - The NFU has welcomed Robert Wiseman Dairies' decision to increase milk prices by 1p per litre from November. NFU dairy board chairman Gwyn Jones praised the companies that had increased the farm gate price but issued a warning that greater efforts were essential to all farmers to maintain secure supplies.

Mr Jones said: "Farmers have been calling for price increases to cover costs and allow for reinvestment for months and we are finally starting to get a response. Announcements from Tesco, Milk Link and Wiseman are encouraging signals that the industry is moving in the right direction - away from the commodity pricing that was so much the scourge of the industry in the past and towards much more structured, collaborative supply chains."

However, Mr Jones warned that, while the increases provided some respite, farmers' desire to invest heavily in their businesses would require greater commitment from the supply chain not just to pay a profitable price, but to offer farmers a better long-term package to build confidence in fragile circumstances.

"There is clear evidence with milk being brought in from Northern Ireland that falling production has brought the industry to tipping point. I take no pleasure in this, but critical mass is now being eroded alarmingly and the outlook on the markets is gloomy. Nevertheless the industry can turn things around and the NFU will be setting out a survival plan later this autumn."

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