London, 23rd November 2018 – Dairy UK processing members alongside dairy farmers outlined their opposition to the planned regulation of contracts and warned of the longer term consequences to flexibility and pricing such changes could bring.
In a press briefing earlier today, processors and dairy farmers discussed their key objections and concerns around the potential negative impact of regulation of contracts on dairy businesses.
Many felt there was an urgent need to ensure that differing viewpoints from the farming community were heard by Government, and that there was a lack of education on the detrimental impact regulation could have on the long term health of the dairy sector.
Both dairy farmers and processors spoke of the increased risk of price volatility and inflexibility in the market. Regulation brought forward under the CMO would mean a less competitive market with more restrictions, which in many cases would prevent processors from addressing short-term or ad hoc issues in the milk market, harming dairy farmers.
Commenting on today’s discussions, Paul Vernon Chair of Dairy UK said: “Regulation would create a risk of greater volatility in the market, something which farmers and processors definitely do not want to see. Far from creating less risk, regulation would create more and result in a less competitive industry at a time of great instability in this country.
“We intend to work closely with our members and their dairy farmers to communicate our message to Government and ensure we have a sustainable and flexible dairy industry for farmers and processors.”
Defra announced its intention to regulate contracts earlier this year, with a consultation on the implementation of measures to regulate to be published in due course.