Something that should be commonplace in the dairy market has in fact become a rare sensation: for a few years now, Fair Milk has made it possible for farmers to earn a decent living. This brand founded in 2006 in Austria now puts socially sustainable products on supermarket shelves for consumers. At the Fair Milk Conference held in France, FaireFrance was joined by other Fair Milk projects and the European Milk Board asbl (EMB) to celebrate the progress of this important brand founded by farmers.

The Federal Ministry of Food and Agriculture (BMEL) organised a conference on the “Future of dairy farming in Germany” on 31 August in Berlin. In addition to the BDM, the AbL also participated in this conference and provides their evaluation of the event, which they believe expressed support for dairy farming.

On 31 August, the Federal Ministry of Food and Agriculture (BMEL) organised the “Future of dairy farming in Germany” conference in Berlin. According to the BDM (German dairy farmer’s association) and the AbL (German small farmers’ association), this event was the first time that the Federal Ministry showed signs of support for dairy farming. As a member of the “Initiative for fair prices in the food supply chain” (IniFair), Environmental Action Germany (DUH) used the conference as an opportunity to call for a law on fair prices.

Over 250 representatives from the dairy industry, research, NGOs, trade and farmers themselves engaged in discussions at the conference. Parliamentary State Secretary at the BMEL, Dr. Ophelia Nick, stated: “Dairy farms need prospects for the future that reconcile economically viable production with sustainability and societal demands. We support dairy farmers and want to work with them to find ways towards sustainable milk production that is climate-friendly, promotes animal welfare and generates high added value. We want to preserve dairy farms and diversified production structures. We commit to creating a better power balance along the food value chain and strengthening the position of dairy farmers.

Looking at the set-up of supply relations between milk producers and dairies will be a key element in this regard. We will discuss appropriate measures that are compatible with EU law with the coalition partners. We want to ensure that farmers can make a living from their activity. It is in our hands to work together and create a future-proof system. This will ensure a future for milk production in Germany.”

The future of milk production is at stake

For Ottmar Ilchmann, AbL representative at the conference and dairy farmer in Lower Saxony, it is no less than the future of German milk production that is at stake. “The strong participation from the agricultural sector, dairy industry, policy-making and the ministry, and not to forget NGOs, in the conference clearly shows that there are high expectations and even concerns. The expectations of dairy farmer representatives were, at least in part, addressed by both State Secretaries Bender and Nick.” He believes that the introduction of a new eco-scheme for grasslands/pastures, efforts to use Article 210a of the regulation on the Common Market Organisation more effectively to remunerate climate actions, and, most importantly, the implementation of Article 148 are first steps in the right direction.

“This instrument would send a strong signal in terms of market design in the agricultural sector, where producers are no longer treated as the last link in the chain that must feed off 'spare change', but can engage in negotiations about quality, prices and volumes on an equal footing. Furthermore, we must take steps to ensure that cooperative dairies are also covered by compulsory contracts. This is the only way to move away from overproduction that lowers prices. Adjusting milk production to meet demand defined by purchasing power is the only way to reduce market fluctuations and to generate the necessary revenue to live up to societal demands when it comes to animal welfare, climate action and environmental protection. It is no less than the future of German milk production that is at stake.”

DUH calls for law on fair prices

Reinhild Benning from Environmental Action Germany (DUH), which is a member of the “Initiative for fair prices in the food supply chain” (IniFair), used the conference as an opportunity to call for a law on fair prices. “The future of milk production in Germany largely depends on whether the dairy industry and supermarkets are obliged to pay fair prices. Today, a farm that has decided to follow environmentally sustainable and animal-friendly livestock practices has meagre prospects for the future because dairies often do not pay cost-covering milk prices – and Minister for Agriculture Cem Özdemir has only idly looked on. Even if there are EU rules against unfair trade practices, their German implementation is so weak that it does not benefit farmers in any significant way. And then the federal government goes and also cuts funding in the GAK (Joint task for the improvement of agricultural structures and coastal protection), which allowed farms in transition to benefit from adopting better livestock practices”, explains Benning.

One thing is clear: “Without decisive political support for appropriate prices for milk and other agricultural products, it will be financially almost impossible to modernise livestock farming, which is urgently needed. That is why we call on the federal government to immediately introduce a law on fair prices. Regions characterised by expansive pastures and traditional farming structures, like Baden-Württemberg and Bavaria, would benefit from cost-covering prices for contractually defined volumes. Countries like France and Spain are already significantly ahead of us and have taken measures that ensure fairer prices while complying with EU legislation. The federal government must catch up as fast as possible.”

Together with the dairy farmers of the European Milk Board (EMB, where the AbL is a member) as well as development and environmental organisations, the DUH has founded the “Initiative for fair prices in the food supply chain”. This initiative calls for urgent implementation of the governing coalition’s promise of better conditions for the dairy sector and measures to fight unfair trade practices. According to the initiative, the Federal Minister for Agriculture is yet to make real progress on this front. In the meantime, the dramatic trend in farm closures continues and Minister for Finance Lindner is pushing for further cuts to the tune of 300 million euros from the "Joint task for the improvement of agricultural structures and coastal protection" – and he has reservations about the animal welfare bonus as well.

Read the full article in the Unabhängige Bauernstimme newsletter: www.bauernstimme.de

Ottmar Ilchmann, dairy farmer and AbL President for Lower Saxony

Things are far from idyllic in the Swiss alps! Producers continue to struggle and their numbers keep dwindling. In 2022, some 300 dairy farms definitively shut their doors. There are only 17,600 farms still hanging on – we would not have dared imagine this figure ten years ago, so it is safe to say that we are facing hard times.

A fair milk price for producers is one that covers all their production costs, offers them decent pay for the work done and ensures that they can put aside savings. It is plain to see that the milk price in 2023 is not fair.