Making milk sustainable amid the dairy crisis

The UK is facing the biggest dairy crisis for years, with prices slumping to 2003 levels and farms going out of business with alarming regularity. But, as Rin Hamburgh finds, there are several initiatives determined to make the most of milk in a truly sustainable way

For anyone following the news today, the word ‘dairy’ may well come with another word close on its heels: ‘crisis’. With prices falling and farmers going out of business on an almost daily basis, there have been protests outside supermarkets, meetings in government, and even a social media campaign, with people sharing Facebook posts pledging to pay more for their daily pint of the white stuff.

The key issue is around farm-gate prices – those received by the milk producers themselves – which are monitored on a monthly basis. A government report published in January showed that rates fell sharply in 2014, to 29p per litre, the lowest in two years. Retail prices have been dropping too, from an average of 59.7p per litre in the year to March 2014, to 55.7p in the following 12 months: a drop of 6.7 percent.

And it only seems to be getting worse, according to Sian Davies, chief dairy advisor at the National Farmers Union. “I’ve been keeping an eye on the average price of four pints of milk across UK, and it fell to 98p in August,” she said. “The last time it was that low was in March 2003, so we’re going back 12 years.”

There are a number of factors influencing the current crisis, many of which are global in origin.

“Most of our customers are people who care about cows, who have woken up to the cruelty in the industry and are willing to pay a premium for their milk.”

Davies explains: “There’s the Russian trade ban; the fact that China – which was the world’s biggest purchaser of dairy products, especially milk powder – stopped buying milk powder in 2013; the fact that the price of oil has fallen so there’s less money in the Middle East, where the change to a more westernised diet meant they were spending more on dairy. And then there’s been very good weather across most of the milk producing countries in the world, so production has been high over the last two years and so in the end supply has far overtaken demand.

“On top of that in the UK we’ve got a very brutal retail price war; the big players in the retail centres are trying to bring back customers from the hard discounters like Lidl, Aldi and Iceland, by discounting household staples like milk.”

While there has been some progress on the supermarket front – Lidl, Aldi and Asda agreed in August to a minimum price of 28p per litre, 4.34p above the average at the time – the overall picture still remains rather gloomy.

Figures covering the last decade, published in Dairy Statistics: An insider’s guide 2015, show just how far the UK industry has fallen. According to the report, by AHDB Dairy, a levy-funded, not-for-profit organisation working on behalf of Britain’s dairy farmers, the number of dairy farms in 2004 stood at 21,616 – by 2014 there were only 13,815: a drop of 36 percent. And according to the National Farmers Union, during August of this year roughly one dairy farm closed per day throughout the month.

The response from many farmers has been to increase production levels in order to generate a profit. Herd sizes grew from an average of 97 to 133 between 2004 and 2014, according to the AHDB report, while the average milk yield per cow has risen by 17 percent, from 6,763 to 7,916 litres per year.

But not everyone is convinced this is the way to improve the situation. Neil Darwent, who is based in Frome, Somerset, has been farming for 30 years. At one point he was responsible for nearly 3,000 cows, milked in 13 herds and run over 4,500 acres – and it was then that he began to question the ‘bigger is better’ nature of the industry.

“There was this relentless pursuit of more and more output, and I began to worry that we are all running faster in order to stand still,” he says. “We were making our cows deliver more, using more and more advanced technology, but the bottom line for farmers only seemed be going down. I began to question what this shift towards industrial milk production would do to our perception of the dairy industry.”

This concern about the devaluing of British milk led Darwent to set up the Free Range Dairy Network in July 2014, a community interest company whose stated social mission is “to promote the value of milk and dairy products from traditional pasture based dairy herds”.

With 50 members across the UK, their aim is to promote a way of farming that delivers a fair price to farmers – by asking for a 5p per litre free range premium over and above base rate milk prices – as well as a healthy and affordable product to consumers, and a lifestyle for the cows that includes the freedom to graze outdoors for six months of the year.

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This is in direct contrast to the trend towards so-called ‘mega dairies’, where cows are kept indoors year round in industrial conditions labelled by critics as ‘battery farming’. While these are more common in countries such as the US, the UK is not immune to the idea; in 2009 an application was made to create a 3,770-cow mega dairy in Norton Heath, Lincolnshire, although it was eventually denied in 2011 thanks to an official objection from the Environment Agency.

“The British public have lost sight of the value of milk and that’s what we’re trying to address,” says Darwent, who was named BBC Outstanding Farmer of the Year in 2014. “The FRDN is about getting people to think beyond the colour on the top of the bottle and back to the farm gate, the way we produce the milk.”

Darwent hopes to educate the general public about the choices they have as consumers, and the differences between milk produced under various systems, using a combination of social media and other awareness raising campaigns, and working with animal welfare and other relevant organisations, such as the Sustainable Restaurants Association.

“People don’t understand the true cost of large scale milk production, whether that’s to the environment through increased pollution, the welfare of the cow or the quality of milk, and that’s what bothers me,” he says. “The true cost is not what’s on the bottle, and for sustainability we need to look beyond that.

“It suits the large companies to just call milk ‘milk’ and maintain a perception that all milk is the same, but it’s not. Everybody loves to use pictures of pretty cows in fields to promote their milk but the farmers who are actually doing that aren’t getting the rewards. This perception is not allowing people to make an informed choice about the milk they buy, and until they can we’re never going to have any value in the job.”

“The true cost of milk is not what’s on the bottle, and for sustainability we need to look beyond that.”

Another producer striving to raise consumer awareness is the Ahimsa Dairy Foundation, a not-for-profit, cruelty free micro-dairy working in conjunction with Commonwork, an organic farm in Kent. As well as grazing their cows outdoors for much of the year, they have a strict no slaughter policy.

“A cow can live until she’s about 20 but in the modern industry she’s lucky to make it to her fifth birthday,” says Ahimsa co-director Nicola Pazdzierska. “Our cows retire after they’ve given their best and we don’t kill the bull calves.”

Pazdzierska believes that helping consumers understand the benefit of ethical farming methods – which she says can be overlooked in the larger, more industrial dairies – is a key to improving farm-gate and retail prices.

“Most of our customers are people who care about cows, who have woken up to the cruelty in the industry and are willing to pay a premium for their milk,” she says. “Why should milk be cheaper than water? It’s a miracle food, we can do so much with it and it has so many health benefits.

“It’s a consciousness raising thing, that’s how we see it,” she adds. “The better informed people become, the more they’ll vote with their feet.”

The FRDN and Ahimsa are just two examples of the ways in which modern farmers are taking a new approach to their branding, something the NFU’s Sian Davies believes is an important step towards recovery in the dairy industry.

“Farmers are looking at new products and how they brand them so consumers understand the story behind the product,” she says. “There are lots of initiatives – farmers doing their own processing of yoghurts, cheeses and so on – and there’s a lot of support for them to do that, which gives them ways of adding value to their own farm.”

Although the figures may still show a relatively bleak picture, Davies believes that there is hope for the UK dairy industry yet.

“We’re really efficient, we pick up technology really quickly, we have good farmers, we’re a grass-based industry in this country, we get a lot of rain so the grass grows throughout the year, so the cost is lower than in lots of places in Europe – all of those things are positive,” she says.

“We believe that the future of the dairy industry is positive, we just need to get through this current downturn and keep as many farmers as possible in the industry through this period.”