UK Dairy Sector

Joan Ryan Excerpts

Wednesday 20th April 2016 Westminster Hall

[Several hon. Members rose—]

[Joan Ryan (in the Chair)]

I say to right hon. and hon. Members that we have 10 people seeking to contribute, so I am placing a four-minute limit on Back-Bench speeches. If everyone is helpful, everyone should get in on that basis. I will be seeking to start calling the three Front Benchers at 3.30. With the Minister’s co-operation, I ask that we allow the mover of the motion two minutes at the end, bearing in mind that we have a few minutes past the hour as we started late.

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[Joan Ryan (in the Chair)]

Order. The hon. Lady should draw her remarks to a close.

[Ms Ritchie]

Like the all-party group on dairy, I believe that dairy should be put back on the daily menu. That means encouraging parents, schools and others. I urge the Minister to take heed of this debate.

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[Several hon. Members rose—]

[Joan Ryan (in the Chair)]

To accommodate all those who wish to speak, I am now going to reduce the time limit to three minutes per speaker.

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[Rishi Sunak (Richmond (Yorks)) (Con)]

I thank the hon. Member for Ceredigion (Mr Williams) for obtaining the debate.

I recently spoke with an 80-year-old dairy farmer, in my North Yorkshire constituency, who told me that in a lifetime of dairy farming he had never seen times as bad. I believe that there are five key steps that need to be taken by Government, industry and consumer to bring some relief to him and others and safeguard the future of dairy farming in the UK. First, we need buyers to give farmers a fair deal. I commend retailer initiatives from Tesco, Sainsbury’s and others, which ensure that farmers receive a fair cost-of-production price for their milk, but if the dairy sector is to be sustainable, retailers need to expand that good work on liquid milk to other dairy products, and, indeed, more milk buyers need to follow the lead of the large retailers. That process should, of course, be overseen by a robust Groceries Code Adjudicator with additional powers to investigate downstream supply chains and indirect suppliers.

Secondly, we must make and buy more British. It might seem that there are few things more British than an honest slice of Cheddar, yet almost half the cheddar consumed in the UK today is imported from overseas. We must invest more in processing technology to ensure we add value to British milk by turning more of it into British butter, yoghurt and cheese, rather than importing. Alongside that, we must have better food labelling so that large retailers and caterers clearly show consumers how much of their dairy products is British.

Thirdly, the industry needs to create more dairy producer organisations. Groups of farmers banding together to negotiate a better sale price for their milk and a lower purchase price for their feed, and to share machinery, are commonplace across Europe. In the UK we currently have only one such producer organisation. In Germany, there are 143. If farmers are to balance out the power of big processers and retailers, that must change.

Fourthly, we need to develop a working futures market. As New Zealand and America show, futures can be a vital tool for providing price stability in a volatile world. It is crucial, therefore, that the Government continue their efforts to ensure that the relevant benchmarking data are available, which will help British dairy futures to become a reality.

Finally, Government at all levels must buy British. I know that the national Government are working hard to purchase British dairy products, but at a regional level we can do more. We must push local government, the military, hospitals and schools to do their part as well.

In conclusion, without its dairy farmers, the lush fields of the Yorkshire dales in my constituency would soon turn to scrub and its dry stone walls would go unrepaired. Only if the Government, farmers and consumers work together will we preserve our dairy industry and, with it, our rural communities and beautiful countryside for generations to come.

[Joan Ryan (in the Chair)]

With the co-operation of the Front Benchers, I have time for a couple more speakers. If everyone is to get in, they will have to speak for no more than two minutes. I leave it to their co-operation.

[David Simpson (Upper Bann) (DUP)]

The agri-food sector employs about 100,000 people across the whole of the industry, and the dairy sector makes up a lot of that figure. When I speak to farmers, they tell me that there are a number of things that they have no control over. They had no say on the Russian ban, and they had no control over the quotas being done away with or the fluctuations of the euro.

Everyone knew that when the quota system went there would be a free-for-all and production would go up. The production of milk in Northern Ireland has increased by 4% this year, even though prices are falling. On Monday, I spoke to farmers who have been told that they will be paid 16p a litre for milk in May and that it will go down to 15p in June. That is crazy.

We have heard today of the pressure on farmers. Hon. Members have talked about meetings they have had with farmers who have shed tears. I have experienced the same thing. Farmers do not know how they are going to pay their next bill or how they are going to fend for their families. We have also heard about the issues of mental health and stress, about which I have written to DEFRA. Something for the farming community needs to be put into the UK mental health strategy.

The dairy sector is a vital industry, and it needs help. We can talk about retailers and new cheese factories, but that takes time. Something needs to be done now to alleviate the difficulties and problems that the dairy sector faces. In Northern Ireland, there is talk of a voluntary reduction of milk production. Whether that happens is a matter for the farmers and the processors. France and a number of other countries are in favour of a reduction, but the problem is that the tap cannot just be turned on and off in milk production. More help is needed, and we look to the Government to ease the difficulties and problems.

[Joan Ryan (in the Chair)]

I call Mel Stride—[Interruption.] Sorry, I call Simon Hoare.