The fact that being a farmer has been very difficult for a number of years now is no secret. For example, there is a systematic shortfall between milk production costs and producer prices. Over a five-year period, the cost shortfall for German producers has been 20 percent, which implies that production costs to the tune of 9 cents per kilogram of milk are coming out of farmers' pockets. The situation with organic milk is quite similar, with a shortfall of 21 percent in 2018/2019.

"Our farmers are getting increasingly left behind, both economically and socially," summarises Erwin Schöpges, Belgian dairy farmer and President of the dairy farmer association European Milk Board (EMB). "The orientation of the EU agricultural policy is at the root because it does not promote socially sustainable farming. It is instead aimed at the production of cheap products that can compete on international markets. This has been the situation for many years now and has also led us to take to the streets in protest for just as long." EMB Executive Committee member Johannes Pfaller from Germany adds: "If further restrictions are imposed on farmers in what is already a very unfavourable situation, the current widespread protests should come as no surprise. How can producers, on the one hand, continue to provide cheap raw materials while, on the other, also fulfil additional cost-intensive conditions? This is simply impossible and this conflict is destroying producers." As Pfaller goes on to mention, it is very clear that the market position of producers needs to be significantly improved through an appropriate framework. This would give farmers the possibility to properly defend their economic interests.

Paper on sustainable production in the EU

In order to resolve this conflict between the pressure to produce cheap products and comply with sustainability conditions, the current agricultural policy must be amended at EU level. "There needs to be a change in tack, to head toward responsible production in the EU," says Erwin Schöpges. "To this aim, the EMB has drafted a paper that takes both socio-economic and environmental sustainability into account." It calls for the necessary implementation of a crisis instrument to dampen the effects of constant crises. This instrument would lead to less overproduction, which would contribute to better producer prices as well as to preserving resources – a key factor in environmental sustainability. This paper also rejects agricultural products being included in free trade agreements as they counteract fair and sustainable production practices. 

The paper also makes it clear that policy-makers need to uphold a number of important conditions if greater sustainability – both environmental and social – is to have a fighting chance in the agricultural sector: 

• Before farmers are able to actually comply with demanding restrictions, the underlying basis for their activity needs to be robust. This means that prices must cover all production costs, including fair remuneration for producers. The above-mentioned crisis instrument must be implemented at EU level and the market position of producers must be strengthened through an appropriate framework.

• The environmental strategies and solutions underpinning the restrictions must be discussed and decided on together with producers. The positive environmental contribution farmers are already making – carbon sequestration and combating erosion, to name just two – must be duly recognised, and a fair decision must be reached on compensation for environmental compliance costs. After all, farmers cannot be the only ones bearing the brunt.

Fair cooperation between all stakeholders is the only way to achieve socially and economically sustainable as well as climate-friendly agriculture. Policy-makers have an important role to play in ensuring the correct framework is in place, so that farmers are no longer left behind but are, once again, recognised as an important part of the social fabric.

In addition to their political work, EMB producers are also tapping into their own strength and engaging directly with consumers. For instance, dairy farmers themselves have launched the Fair Milk brand in a number of countries in Europe, and it has clearly shown that cost-covering prices are not a pipe dream. But in order to allow for fair prices to become a reality beyond a niche market and to actually get a foothold in the dairy market at large, we need – as described above – an appropriate political framework.

EMB press release of 16 January 2020

The association of Portuguese dairy farmers (APROLEP) was officially founded on 4 March 2010 by a group of dairy producers, in response to the major crisis affecting the sector since 2008. From the very beginning, the objective has been clear: "a fair price for Portuguese milk" and "clear rules to adapt production to consumer needs".

We are a non-partisan organisation representing dairy farmers and are independent of any and all distributors, retailers, the dairy industry and other farmer organisations. We are always willing to take a cooperative approach to solve the issues faced by dairy farmers. We are funded by membership fees as well as advertising by companies providing products and services to dairy farmers, featured in our magazine and at our events.

The average milk price paid to producers in Portugal (€30.83/100kg in November 2019) continues to remain below the EU average. Effective solutions for the threats affecting our activity, reputation and products are the need of the day.

APROLEP has a very well-developed communication and outreach service with a biannual magazine, a website, and a Twitter account. The APROLEP Facebook page currently has 8,850 followers. Furthermore, we have also launched the "APROLEP Forum" on the Telegram app to facilitate discussions and to exchange information in real-time with producers across the country. We use all of these tools to stay in constant contact with our members.

APROLEP is delighted to join the ranks of the EMB, an organisation that has been a source of inspiration through the years. Together we stand stronger!

Carlos Neves, Vice-president of APROLEP

In their year-end market data for 2019/2020, the German farmers' organisation DBV characterised 2019 as "an exceptional year for the dairy sector": on the one hand, raw milk production costs in many regions in Germany were significantly higher in 2018 and 2019 than in previous years because of the extremely hot and dry summers – and the associated poor feed harvests. On the other, producer prices in 2019 were extremely stable. The federal average through the course of the year oscillated minimally between 32.6 and 33.8 cents/kg."

According to Ottmar Ilchmann, dairy farmer and President of the German family farmers' association AbL in Lower Saxony, stability is generally understood as something positive. "However, when the DBV talks about 'extremely stable' milk prices while looking back at the past year, they definitely qualify as frontrunners in the contest for 'euphemism of the year'," explains Ilchmann, because this stability does nothing to improve the situation on dairy farms; in fact, it simply conceals the bitter truth. As Ilchmann puts it, these stable prices throughout the year also mean that the cost shortfall has consistently remained at about 10 cents or 25% below cost coverage levels – and this is something that the DBV chooses to give no mention. "These 'stable' prices imply extreme instability and pose an existential threat to farmers; further farm closures can be expected", says Ilchmann. In his opinion, if the DBV still saw itself as a representative of dairy farmers' interests, it should have capitalised on the opportunity to strengthen the market position of dairy farmers within the process of drawing up a dairy sector strategy. "It seems, however, that they are more concerned with upholding the interests of cooperative dairies, where their members, all too often, have a major say on executive and advisory boards," criticised the AbL regional president.

The dairy sector has been working on a "Sector Strategy 2030" for a while now. It was supposed to be presented in autumn 2019; however, there is still nothing on the table. The process is being led by a steering committee, which includes representatives from the DBV, the German Raiffeisen Association (DRV) and the Dairy Industry Association (MIV).

Article by FebL/Unabhängige Bauernstimme

In our previous newsletters, the Swiss and French Fair Milk projects were presented. In this current edition, Luxembourgish dairy farmers give an insight into their Fair Milk project.

D’fair Mëllech in Luxembourg

In 2011, forty eight dairy farmers from Luxembourg came together to found the cooperative Fairkoperativ Lëtzeburg (FKL) and with it, their own brand called D’fair Mëllech. From this point on, it became possible for Luxembourg’s consumers to support dairy farmers directly: for every litre of milk sold, 10 cents go to the participating farmers. In this way, the usual inadequate milk price is raised to a fair milk price.

While producing high-quality fair milk, we producers are conscious about energy and raw-material consumption on our farms. The objective is to optimise the energy balance in order to bring our farm operations in harmony with nature.

Today, our cooperative FKL offers 13 different milk products in the categories of long-life and fresh milk, chocolate milk, butter, cream, ice-cream, cheese and yoghurt. The chocolate milk as well as some of the ice-cream varieties are produced in collaboration with fair trade, i.e. all the ingredients are derived from fair trade. The speedy growth over the last few years clearly shows that there is broad support for our concept among Luxembourg’s consumers. In fact, retailers also fully back D’fair Mëllech.

Direct contact between us producers and our consumers is the most important aspect of our project. Our members regularly present our products in shops and at a range of events. At the end of the day, it always gives us great pleasure to see how much consumers enjoy D’fair Mëllech.

Dairy farmers need a fair milk price that fully covers all their production costs. They do all the work and also undertake a significant economic risk. They preserve cultural landscapes and produce high-quality products. If you are in favour of fair, local products and projects such as D’fair Mëllech, there is already a lot you can do in Luxembourg to promote fairness.

Further information: www.fairmellech.lu

Danielle Warmerdam-Frantz and the EMB Office