Skip to main content

Milk Prices

Volume 554: debated on Thursday 6 December 2012

After months of hard work, not least by my predecessor, the right hon. Member for South East Cambridgeshire (Sir James Paice), the industry code of practice is now being translated into contracts. I am encouraged to hear of new contracts and pricing mechanisms that improve the transparency and fairness of milk prices for farmers. The Government will soon be consulting on our domestic implementation of the EU dairy package, enabling dairy farmers to form recognised producer organisations to further improve their bargaining power.

There has been a dairy herd of Holstein Friesians in Eggington, outside Leighton Buzzard, since 1933, but I was concerned to learn from the farmer in July that he is not confident that milk production can continue there, which would be an absolute tragedy. The farmer told me last night that he receives 30.5p per litre, but when I checked this morning, Tesco was selling milk for 86.3p per litre, which is 49p a pint. Is the Minister sure that farmers are getting a fair share, and what can we do to ensure they have a sustainable future?

We need to do a lot of things to support the dairy industry, but I am optimistic. If we can make the voluntary code stick—I have no reason to suppose we cannot—it will go a very long way to improving the transparency of contracts, and, as the hon. Gentleman knows, the Groceries Code Adjudicator Bill is going through the House. The Department will do everything it can to maintain the profitability of producers and ensure that every part of the supply chain is fairly treated, including the retailer and the consumer.

Following our meeting of some weeks ago, will the Minister outline what discussions he has had with the devolved Minister in Northern Ireland on an evaluation of the operation of the voluntary code for the dairy industry? Is he satisfied that the dairy industry is being sufficiently protected?

As I have indicated to the hon. Lady, I would be very happy to talk to the Minister in the Northern Ireland Government, whom I met at the Agriculture Council. That matter did not crop up in our conversation, but the door is open to discuss how we might move forwards together on this important issue for farmers in the hon. Lady’s constituency.

My hon. Friend the Member for South West Bedfordshire (Andrew Selous) mentioned Bedfordshire and Tesco, but will the Minister praise the work of supermarkets such as Waitrose, which not only pays a fairer price, but pays promptly?

Both those elements are essential, but I do not want to name and shame specific supermarkets, however tempting that might be. I want all major supermarket chains to behave in a fair and transparent way as far as their suppliers are concerned. There are signs that that is happening not only in the dairy sector, but in other produce sectors.

The supply chain practices affecting our dairy industry affect other livestock producers, perhaps none more so than our pig producers, which are close to the Minister’s heart. Pigs are being sold well below the cost of production. Given VION’s announcements last week, what will the Minister do to ensure a future for the pig industry?

The hon. Lady is absolutely right to say that I am interested in the pig sector, having bred pigs myself. She will know that we cannot disguise the cyclical nature of the pig industry. Having said that, I am concerned about the current position, but there are signs of progress. Some supermarkets are now prepared to share risk in the pigmeat sector, which I want to encourage.

The milking of pigs is a novelty, and although I am not an expert on these matters, I hazard the guess that it would prove to be an unprofitable activity.