A LOCAL dairy farmer is hoping to catch an 11th hour lifeline thrown by Tesco as part of a new "Local Choice Milk" deal. If Graham Batstone is successful in his application to become one of 150 farmers across the UK to be taken on board under the scheme, it might reverse his decision to quit. The Batstone family have been dairy farming since 1936 at Old Soldridge Farm near Medstead – Graham himself has run the farm for the past 25 years, ever since he left college. It would be "a terrible wrench" for him to give up on the dairy industry, but in January this year desperation triggered the sale of one third of his 75-strong Friesian herd. The situation had become so dire that instead of earning a living he, like many farmers nationwide, was actually losing money on milk production. "The milk cheque wasn't stretching to pay for everything," said Mr Batstone. On top of that he was unable to pay for relief to support what is a 24/7 commitment to milk. Having determined to follow the national trend and get out of dairy farming, Graham Batstone has been forced to think again. Thanks to the Tesco scheme there could at last be a light at the end of the tunnel. Spurred on by the Dairy Farmers of Britain co- operative, he has applied to become part of Tesco's "Local Choice Milk" scheme. Open only to small and family farms, the scheme would pay 5p more a litre for their milk and that, says Mr Batstone, "would make all the difference". At present Graham Batstone gets 17 to 18p per litre (ppl) for his milk, but under the Tesco scheme he would receive 22p. His milk, which is processed at Portsmouth, would be sold locally, bringing with it a freshness and accountability not often seen in the major supermarkets. "The last time the supermarkets put up the price of milk it didn't trickle down to the farmers, but with this scheme it will," said Mr Batstone, who is hoping that the move by supermarket giants like Tesco and Waitrose will trigger a revival in the UK's milk market. But for many farmers it has come too late. According to Richard Buer, secretary for the Alton and Petersfield branch of the NFU (National Farmers Union), Graham Batstone is typical of those working in the dairy farming industry. He told The Herald: "On average English farmers lose four pence on every litre of milk they produce, despite being among some of the most efficient in Europe. This situation has prompted nearly two thirds of milk producers in the South East to cease milk production and has deterred others from inward investment. "Something has to change – farmers must see a fairer share of the retail price for their milk if supermarkets want to continue to stock British milk and dairy products." According to Richard Buer, farmers have been receiving an average of 18 ppl at the farmgate for their milk, compared with 24.5ppl 10 years ago. By contrast, the cost of production has risen significantly in those same 10 years, so that the average dairy farmer is now making a loss of over three pence on every litre of milk that leaves the farm. Over the same period, retail margins have risen from three pence per litre to around 16ppl. While Mr Buer believes that the move by Tesco to increase the milk price to its own suppliers to 22ppl is significant, the realisation by the supermarket giants of the crisis in the dairy industry may have come after the cow has bolted. In 1995, there were over 28,000 dairy farms in England and Wales. By the end of 2006 there were 13,000. A recent survey conducted by the MDC found that a further 16 per cent of dairy farmers plan to cease milk production within the next two years and production could fall by as much as 900 million litres, or seven per cent. The future of the dairy industry has been hotly debated during the National Federation of Women's Institutes (WI) "Great Milk Debates". The NFU has provided speakers to debate the supply chain issues that could determine the future of milk production in England and Wales. The debates gave consumers a chance to put forward ideas and solutions to the current crisis, The MDC said: "Dairy farming is hugely important to the countryside, the economy, the fabric of rural life and to the consumer. "But continuing poor farm-gate milk prices have prevented farmers from making the necessary inward investment for the future." He added: "Dairy farming families work long hard hours to provide a world class product, yet a recent survey suggested that milk production could fall by as much as seven per cent over the next two years if confidence is not restored." Public awareness of what has been happening in dairy farming and of why dairy farming matters is crucial in achieving supply chain partnerships that deliver fair prices for good products. That is why these debates were so important and so welcome." WI members voted at their AGM in 2005 to raise public awareness of the unfair difference between the retail prices of milk and the price paid to the farmer.
