The British organisation “Farmers For Action” has been protesting since early October against the continuing milk price cuts by different dairies (incl. Müller Wiseman, First Milk, Dairy Crest). Farm-gate prices have fallen about 25% in recent months, and the milk producers fear for their future.

Dairies, distribution centres, supermarket chains and most recently a cheese dairy were blockaded with tractors in several protest campaigns. The protests are aimed first and foremost against the continuing milk price cuts and against the reduction in value of dairy products. Farmers are complaining that British dairy products are being devalued by pressure from the trade and also by numerous cheap goods advertisements. Another reason for the protests is cheap imports of cheese from Ireland and other European countries, forcing British cheese off supermarket shelves.

For their part the dairies justify the price cuts with the plentiful supply of milk and the weak demand for dairy produce. Many dairy farmers have been involved in the protest campaigns – hundreds of farmers took part in the peaceful blockades. The media gave considerable coverage to the protests, and understanding of the farmers’ situation is growing among consumers. One successful outcome is that Arla has announced it is freezing prices. Arla Foods has started a campaign targeting consumers directly. Called “Support Our farmers”, through advertising in the press, leaflets and social media it calls on consumers to buy specific Arla brands of milk, butter and cheese to support the milk producers directly.

The National Farmers Union (NFU) has meanwhile urged the supermarkets and the trade to pay higher milk prices. David Handley, Chairman of “Farmers For Action”, feels it is imperative milk producers reduce milk volumes to counterbalance the dairies.

Regina Reiterer, EMB

The Belgian co-operative dairy “Laiterie des Ardennes” is warning its members of a potential cut in the milk price next year. The dairy informs that from 1 January the price will drop to 25 cents/litre under the heading “Unless a miracle happens... or the EU takes effective measures”.

Excerpt from the dairy’s members newsletter

There are two important trends: on the one hand plentiful supply in Europe and on the world market (due to good production conditions and a stimulating milk price), and on the other hand falling demand (primarily due to adjustment to the quantities stockpiled in China). The development of these trends enabled an acceptable milk price, though. The Russian ban on imports has created a huge imbalance between supply and demand (including for cheese). This problem will not resolve itself.

It is not for us to judge the EU institutions’ decisions. Bu we are entitled to a clear position from the EU on the consequences of confrontation between our countries and Russia: either the EU informs producers that this sacrifice is necessary and acknowledges that this will drastically reduce their incomes, or the EU decides that the efforts have to be spread over every sector of the economy and makes a budget to this effect available. But the EU should stop minimising the true consequences of the ban on imports and stating that the budget and the current intervention threshold (let us not forget 2009) will suffice to protect producers against the negative consequences.

Why the “spin”? Why not tell the truth? The price will remain decent until the end of the year, but from January the price will plummet – unless a miracle happens or the EU takes appropriate measures. That is why the EU should act or tell the truth: we cannot hope for a miracle.

Astrid Sauvage, EMB

Interview with Fredy de Martines, President of D'Fair Koperativ Lëtzebuerg

In Luxemburg Fair Milk has been doing very well since its launch in 2011, and sales have risen by 20% year on year. Fresh cream (500ml) was added to the range very recently. Luxembourg supermarkets now stock fresh full-cream milk, fair butter and cream along with UHT milk (3.5% and 1.5%). The plan is to introduce fresh semi-skimmed milk in mid-November. Fresh milk has been supplied to nursery and school canteens in 10-litre pails for six months now.

Mr de Martines, as a small country Luxembourg has a big advantage over the other Fair Milk countries in marketing Fair Milk. What are the reasons for the healthy sales figures?

We are stocked by every supermarket and small shop in Luxembourg, except for Aldi and Lidl. We deliberately haven’t contacted the discounters because it doesn’t fit in with our concept. We are very strict about pricing, and we want to stipulate the prices and margins ourselves. That wouldn’t be possible with the discounters, quite the reverse. In my view it is extremely important that I as a milk producer negotiate prices with the supermarkets. Only a dairy farmer can argue with conviction: “This is how we work and this is how much we want to be paid”. We also have very personal contact with all our partners. That is very important with the supermarkets, for instance, as we want our products to be well placed. Another point is undoubtedly our good relationship with Luxlait, the only dairy here in Luxembourg. Our major advantage is that our dairy both packs and distributes our products. Even small orders are supplied every day. We have also built up a customer base that remains loyal to our brand. Every customer who buys the Fair Milk sticks with it.

How is your co-operative – the Fair Koperativ Lëtzebuerg – organised?

Our co-operative is open to any dairy farmer in Luxembourg. At present we have 47 member farms, with very different structures. Our smallest farm has 30 dairy cows, the largest about 150. Essentially the affiliated farms must fulfil three main obligations. Each farm has to work 1½ days a year for Fair Milk and become actively involved in campaigns and events to advertise the “Fair Milk” project. Another condition is that our member farms do not exceed their milk quota. The third obligation relates to what we call the “farm-gate balance”: the farms are obliged to farm as sustainably as possible to improve the annual nutrient and energy balance. This balance is measured by a neutral agency.

The first thing we associate with Fair Milk is cost-covering prices for the milk producer. An extra 10 cents per litre of milk goes to the farmer. What is the image of the “Faire Mellech” brand among the Luxembourgers?

The consumers know that 10 cents go directly to the milk producer, and that salves their conscience. Without doubt our major strength is also the packaging, which sets us apart from the competition. The Faironika cow in the national colours stands on its own. Another important thing for us is that through the Fair Milk project we establish direct contact between farmer and consumer. We want the consumer to think about what goes into a packet or carton of milk: the work we farmers have, the financial uncertainties. But we also convey an important message with Fair Milk: the member farms work with nature and try to farm as sustainably as possible. The consumers know that in buying our products they are supporting the farmers and at the same time doing something for the environment.

How many people work on the Fair Milk Luxembourg project?

We are a small but very committed team. One person is employed 10 hours a week doing the bookkeeping. Then we have three people working on an hourly basis dealing with orders, customer care and organisation. I myself am responsible for negotiating with the retailers and am the contact for our dairy Luxlait.

What tips can you give other countries?

I feel it is absolutely essential to make a professional start. The supermarket shelves are packed, and nobody is waiting for a new product. We managed to convince the Luxembourg Minister of Agriculture of our project and were given financial support in the start-up phase. The second sponsor we won over was a Luxembourg bank, which is fully behind our project and is still supporting us. With the support of the Ministry and the bank we also come across to the consumers as professional to some extent.

Fair Milk products are available throughout Luxembourg. What are the aims and challenges for the future?

We are stocked by every supermarket and small shop – we can’t expand in this respect. Our aim is to carry on increasing our number of regular customers – we want even more people to enjoy Fair Milk. We want to develop our product range in the long run. We are increasing our efforts to supply educational institutions and old people’s homes with fresh milk.

Thank you very much for the interview, Mr de Martines.

Regina Reiterer, EMB