Dairy Industry

Lord Marlesford Excerpts

Thursday 17th September 2015 Lords Chamber

[Lord Marlesford (Con)]

My Lords, I declare an ex-interest as a Suffolk farmer: 8 October 2004 was the last day we milked cows at home. We gave up because of the price. At the time, the price was 18p a litre and it was costing us 21p to produce. We were producing about 1 million litres. The arithmetic is simple: 3p a litre on 1 million litres is about £30,000, and that was a negative on the bottom line. There was nothing we could do about that. It was a sad wrench. I had milked my father’s cows as a schoolboy. During the school holidays, the cowmen would throw pebbles at my window at 5 am to wake me up. Full of sleep, I would stagger off to help milk by hand my father’s small herd of Guernsey cows. I could still do the hand milking in my sleep.

The problem has changed relatively little. As we heard, only half of the milk produced is drunk as liquid milk, the rest being converted. So the supermarkets know they can cut prices, even if it forces milk producers out of business, without risking their supply of liquid milk. That is the key factor. The figures speak for themselves. In 1995, there were 36,000 dairy farmers in the UK. Now there are 13,000. In the five years between 1995 and 2000, 20% of dairy farmers went out of business. In the next five years, a further 29% did. In the most recent five years, it was another 13%. Yet the crucial figure is that the national output of milk has stayed static during the past 20 years. In 1994-95, we produced 14 billion litres of milk. In 2014-15, we also produced 14 billion litres.

The average herd size has increased but nothing like as much as one would expect. In 20 years, it has gone up from 75 cows per farm to 133. That is in spite of the huge herds of which we heard from the noble Baroness, Lady Bakewell, a few moments ago. Many small producers, for example in the West Country, have no alternative but still struggle to survive and do so at a survival level. Honestly, with the income per person for some of those farmers, there is real poverty. Now, driving from London to Cornwall, cows by the roadside are merely something for the kids to play the “spot a cow” game with. I do not really see a solution to this, only ways to ameliorate the position.

I rather wish my noble friend Lord Deben, who is in his place, was speaking today because he could then explain whether he still feels that the abolition of the Milk Marketing Board—which gave farmers a stable price—was a good thing. That abolition liberated the supermarkets to do their worst. The situation is extremely gloomy. It is essential for Britain’s countryside, the farming community and our food supply that we continue to have a dairy industry.