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Dairy aid package fails to recognise milk price disparity

The recent announcement by Defra on how £26.2 million pounds of EU aid will be distributed throughout the UK has been labelled ‘disappointing and frustrating’ by the Farmers’ Union of Wales.


Rhydian Owen

According to Defra, dairy producers in Wales will receive some £3.2 million of the total allocated to the UK, with England, Scotland and Northern Ireland receiving £15.5, £5.1 and £2.3 respectively. The Welsh Government has already confirmed that payments will be based upon how much milk a farmer produced in the 2014-15 production year.

Newly elected FUW milk and dairy produce chairman Rhydian Owen, said: “The aid is aimed at helping alleviate the current cash flow problems experienced by dairy farmers and to recognise the prolonged period of low and below cost of production farm-gate prices received by this sector.

“Whilst this support is welcomed, the distribution of available funds throughout the UK should have been targeted towards those producers and regions hit worst by the dairy crisis.

“The farm-gate price of milk received by many Welsh dairy producers is far lower than in other regions of the UK mainland, and a distribution which took account of the disparity in milk price would have seen help going where it is most needed,” added Mr Owen.

Despite Northern Ireland receiving a ‘boosted allocation’ to reflect their the lower prices, this principle was apparently not extended to the UK mainland.

According to Scottish rural affairs minister Richard Lochhead, the Scottish Government were not consulted on the allocations between devolved administration, raising concerns that the English administration announced the Welsh allocation with little or no consultation with Welsh Government, or consideration of the additional pressures on Welsh producers.

“More detailed discussions should have been held on how the aid package was to be targeted to help those who need it most,” said Mr Owen.

“In other words, many Welsh dairy producers will now be wondering whether they have been ripped off following the English announcement. Nevertheless, it is now imperative that this one-off aid payment is distributed swiftly and with as little bureaucracy as possible.”

The union says the one-off aid payment – averaging around £1,800 per Welsh dairy farm – should be recognised as a package of limited short-term relief after a period of sustained low process, rather than a move which will address the ongoing impact of low farm-gate milk prices.

“The FUW remains dedicated to working with industry, processors and retailers to identify those measures which will aid in more fair and transparent contracts, management of EU over supply and ultimately a stronger position in the marketplace for producers,” added Mr Owen.

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