Following the collapse of the Dairy Farmers of Britain co-operative, SIMON HALEWOOD investigates the uncertain future facing hundreds of South Cheshire farmers
“IF YOU want to know how bad it is, just imagine having a month’s salary and your pension fund wiped out.”
Middlewich farmer Phil Smallwood is just one of 1,800 or so members of the Dairy Farmers of Britain (DFoB) co-operative around the country whose lives have been thrown into turmoil by the group’s demise.
The organisation, founded in 2002 and based at Stapeley, provided 10% of the UK’s milk – one billion litres each year – and guaranteed its members a fair price.
It went into receivership last month, leaving farmers thousands of pounds out of pocket, with shattered retirement plans and gallons of unsold produce.
As shops react to customers’ recession-beating attempts to cut food bills, it seems what consumers are prepared to pay at the supermarket till has contributed to the loss of more than half the country’s dairy farms in the last 10 years.
Although we are constantly reminded of the importance of shopping local, a once thriving industry is struggling to stay afloat right on our doorstep.
The DFoB’s collapse sparked a scramble to find buyers for milk and while many farmers have been handed a lifeline by co-operative Milk Link, which has taken over the DFoB’s Llandyrnog Creamery in Denbighshire, some have been forced to sell at a lower price.
Regardless, the loss of a month’s milk money has wiped out the possibility of any profit this year.
Members have also lost the initial money they invested in the future of DFoB – sums between £16,000 and £250,000.
A third-generation farmer, Phil took over from his father at Greenheyes Farm nearly 20 years ago and says after years of rumours surrounding the group within farming circles, the collapse did not come as a total surprise.
“I may as well have milked the cows and then poured it straight down the drain,” he said.
“It has been a devastating and dramatic few weeks but not a complete surprise.
“Ever since the Milk Board was abolished in the 80s, we have been heading towards this.
“The DFoB has been struggling for some time but there was a lot of panic when it was finally announced. It has been a disaster for us and a disaster for the whole industry.
“If it had been a factory and 3,500 jobs were likely to go, it would be everywhere – but because we are so fragmented, you don’t realise how big the problem is.”
As many as 200 staff at the Stapeley headquarters may also be affected.
Phil says he has lost about £20,000.
He added: “Everyone has taken a big hit. It’s a very strange experience milking the cows and having no-one come and pick up the milk.
“Small farmers like myself, with between 50 to 60 cows, do not have the same bargaining tools to negotiate a fairer price as farms with 500 and 600.
“If you were a public limited company selling milk to the supermarkets and they dropped their prices, how would you balance the books? Lower your shareholders’ profits or reduce what you pay the farmers?
“Obviously most will do the latter as that’s the nature of the industry.
“There are some vultures and it is driving a lot of people away.
“Although I’m not one of them, I know more and more people are thinking of throwing it in and selling the cows while they are worth something.”