More farmer demos possible over supermarket milk prices

Farmers are threatening further action after hundreds blockaded milk processing plants with their tractors in protest at the prices some supermarkets pay suppliers.

The farmers - angry at cuts of up to 2p a litre - were at sites in Somerset and Yorkshire, and met in Carmarthenshire to discuss their next move.

Farmers for Action (FFA) said members may decide to hold back their milk.

The British Retail Consortium says other purchasers should be scrutinised.

FFA warns that hundreds of dairy farmers could be forced out of business by price cuts - as well as rising feed costs - which would lead to milk being imported in large quantities.

It says some supermarkets pay a fair price directly to farmers for liquid milk.

But it warns that farmers are making a loss of up to 3p a litre on milk used in dairy products - such as cheese, milk and butter - sold by some of those same supermarkets.

'Can't go on'

The National Farmers Union (NFU) said the cuts would be felt by 27% of producers, and impact on 25% of the milk market volume.

FFA's Stephen Britten, at the Arla plant in Leeds - usually one of the UK's busiest with thousands of litres coming in and out of the site - said "we can't go on any longer".

He said supermarkets must pay more for milk - "but it has to come out of their profit and not from the consumers".

"We are tightening our belts all the time but we have a welfare angle - it's no good if we don't look after the cows properly.

"But the supermarkets, their margins are getting bigger and our margins are getting less and it has to stop."

FFA has threatened further blockades on Friday night.

Meanwhile, in Wales more than 200 farmers attended a meeting in Carmarthenshire to voice their concerns about price cuts. Some farmers called for action, with one suggesting pouring milk down the drain in two days of protests.

And in Scotland, an East Lothian farmer delivered 300 pints of free milk in Edinburgh to urge consumers to press supermarkets for a fair deal for dairy producers.

'Ultimate sacrifice'

Mr Britten said that, as a last resort, the farmers would pour their milk "down the drain".

"We're going to go out of business so we'll see how they like it with no milk at all on their shelves."

The Robert Wiseman Dairy processing plant off junction 24 of the M5 near Bridgwater in Somerset was blockaded by more than 200 farmers with their tractors on Thursday night.

FFA chairman David Handley, speaking at the protest, said if the situation did not improve, farmers would make the "ultimate sacrifice" of keeping milk on their farms.

"We have got to fight the industry because if we don't the industry is going to go."

Hundreds of farmers also blocked deliveries at the Arla plant in Ashby-de-la-Zouch, in Leicestershire.

Arla Foods said reducing the milk price was "always the last resort" but it had "literally exhausted all other options".

"It's a tough time and we are not happy about the situation," it said.

The Robert Wiseman Dairy said it simply could not pay the price the farmers were asking for.

But Sarah Cordey of the British Retail Consortium (BRC) said supermarkets were the "wrong targets" in the campaign.

"Eleven of the 12 best paying customers for milk are paid by supermarkets and are under a lot of public scrutiny," she said.

Celebrity backing

The BRC says dairy processors, manufacturers and the public sector should be held accountable in the same way as retailers.

Asda, Morrisons and the Co-operative have previously pointed out they pay a premium above the market price charged by suppliers.

But the farmers' cause has been backed by celebrity chefs Jamie Oliver and Hugh Fearnley-Whittingstall who urged the public to boycott supermarkets that used milk as "a loss leader".

Mr Fearnley-Whittingstall told BBC News the dairy farmers were targeting the three chains as they had the "most punitive and least sustainable" contracts.

Farming Minister Jim Paice said that, while government "cannot and should not" set prices, he would try to "get all levels of the supply chain to make the real changes needed to guarantee the industry's long-term future".

In the dairy industry, the processors set the price they pay farmers for their milk.

Four leading dairy processors recently announced the latest cuts - applied from 1 August.

Robert Wiseman Dairies and First Milk have both cut the price by 1.7 pence per litre (ppl), Arla Foods UK by 2ppl and Dairy Crest by 1.65ppl.

They say they have had no choice because the price they can sell cream for on the commodities market has fallen sharply in the past 12 to 18 months.

Milk processing involves skimming off cream to make milk more palatable for consumers.

The NFU said an average farmer, with about 150 to 200 cows, would lose about £37,000 in revenue from the combined effect of previous cuts in May/June and the new cuts in August.