MSPs to hold inquiry into Scottish milk crisis

Dairy farming has been in long-term decline in Scotland

An urgent inquiry into the milk pricing crisis has been launched by the Scottish Parliament's rural affairs committee.

Global overproduction has cut the cost of a two-litre carton of milk to £1, prompting delays in payments to struggling Scottish dairy farmers.

Committee convener Rob Gibson said they were being hit by rock-bottom prices and rising operating costs.

MSPs want to assess what is being done to stabilise the industry.

Glasgow-based dairy company First Milk announced a two-week delay in payments to dairy farms, citing a "year of volatility" and losses accrued in the first part of the financial year.

'Extraordinary pressure'

Union leaders said the decision to move the payment from 12 January to 26 January was putting "extraordinary pressure" on dairy farms.

Mr Gibson, an SNP MSP, said Scotland's dairy farming industry had been in steep decline since 2002.

He added: "Milk is a staple for most Scottish households, but many dairy farmers are now having to supply processors at less than the cost of production, while the supermarkets are selling milk at unsustainable prices.

"We want to see a good long-term future for the industry in Scotland and therefore we will be looking for explanations from the processers and supermarkets on the steps they are taking to address what is a very worrying situation for the country, the industry and individual producers."

Scottish Rural Affairs Secretary Richard Lochhead added: "Farmers must be paid a fair price for what they produce.

"Like the rural affairs committee, I agree that the decision by the supermarkets to sell four pints of milk for as little as 89p raises serious questions.

"I have already called for retailers to do more to support Scotland's hard-working dairy farmers and processors."