Supermarkets and Dairy Farmers

estebanrey

estebanrey

estebanrey

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8 Mar 2007
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Dairy Farmers are on the news moaning (as usual) about the price they get paid for their milk and are urging supermarkets to give them a 'fairer deal'.

Can someone explain this to me, why aren't farmers in control of what they charge the supermarkets like any other business to business relationship or does it not work like that?
 
It's like anything, if the buyers not prepared to pay for it then it's either lower your prices and sell it or keep them where they are and someone else will undercut you.
 
I was wondering the same thing,

I assume there are only one or two buyers?

why is this situation not treated like price fixing?
 
estebanrey said:
Dairy Farmers are on the news moaning (as usual) about the price they get paid for their milk and are urging supermarkets to give them a 'fairer deal'.

Can someone explain this to me, why aren't farmers in control of what they charge the supermarkets like any other business to business relationship or does it not work like that?
Click to expand...

Farmers aren't allowed to set prices, this would be bad apparently, the processor sets the price now, Wisemans, Dairty Crest etc.

The farmers are right to complain.
 
edscdk said:
why is this situation not treated like price fixing?
Click to expand...

Most things are clearly price fixed yet nothing done.
Most supermarkets don't pay farmers directly, the intermediate fixes the price and the new price will make farmers a loss and at a time farmers costs are rising.

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Better pic with prices
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Stopped buying milk from the supermarket due to this. I now get it from the local milk man who only provides milk from local dairy farmers.
 
The problem for farmers is that milk spoils quickly and most dont have facilities to store large amounts for a long time. So you have a product you HAVE to shift asap... so the buyers have them over a barrel. Either take what we will give you or throw the lot down the drain!

The middle man apparently make money on the cream not the milk ( as we mostly drink skimmed and semi now ) and the price of cream as gone right down.

I dont know why they dont make more cheaper cheese with the milk personally, cheese prices are silly high now, yet apparently milk is super cheap.... some money to be made there i think.

In any case the situation cannot carry on as it is now... losing money hand over fist is not sustainable and we will end up with only super farms left who will probably be less careful about animal welfare and put all sorts of rubbish in the feed.
 
Wouldn't surprise me if all the uk dairy farmers pumped the milk down the drain for a week. Something drastic needs to happen
 
Moses said:
Is this because there are loads of farmers producing milk inefficiently, so it costs loads to produce... whilst there are other farmers who are producing it cheaply, by having huge farms/awesome tech/etc?
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There is an element of that but the bottom line is the milk processors are constantly looking to lower the price they pay.
 
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