Oral Answers to Questions

Debate between George Eustice and Chris White

Thursday 24th November 2016 Commons Chamber

[Chris White (Warwick and Leamington) (Con)]

5. What steps she is taking to support the milk industry.

[The Minister of State, Department for Environment, Food and Rural Affairs (George Eustice)]

Although there are limits to what Governments can do when there is a global downturn in commodity prices, we have implemented a number of measures over the past two years. We made a crisis payment to farmers at the end of last year, we have extended tax averaging to make it easier to offset tax from good years, and we have supported intervention and private storage schemes. Looking to the future, we are working with industry to develop risk management tools such as futures markets, supporting new producer organisations, and opening new export markets.

[Chris White]

I welcome efforts to increase exports of food and drink, but there is still concern about the domestic market in milk. What efforts are being made to ensure that farmers obtain fair prices from supermarkets, and what assistance could the Groceries Code Adjudicator provide?

[George Eustice]

My hon. Friend has made a good point. These have been two very difficult years for the dairy industry. However, I think we should give credit where it is due, and acknowledge that many of the major supermarkets offer their farmers aligned contracts that are linked to the cost of production. Those farmers have continued to obtain good prices over the last two years. Nevertheless, they are a minority, so we are investigating ways of strengthening the negotiating position of farmers in the supply chain, such as reviewing the operation of the Groceries Code Adjudicator, strengthening the voluntary dairy supply chain code, and strengthening recognition of producer organisations.