Government announces new funding to support dairy farmers

Cows at Whittington Lodge Farm

The government has announced that England’s dairy farmers will be able to access up to £10,000 each to help them overcome the impact of the coronavirus outbreak.

It follows considerable campaigning by the Warwickshire-headquartered National Farmers Union (NFU) and industry-wide campaigning for urgent help for the dairy sector.

The financial support comes after the almost complete closure of foodservice and hospitality outlets, resulting in the loss of a market for around eight million litres of milk every week. This has affected more than three quarters of all dairy farmers through drops in milk price or delayed payments.

The new funding will help support dairy farmers – who together continue to produce more than 40 million litres of milk every day – who have seen decreased demand for their products as bars, restaurants and cafes have closed.

Eligible dairy farmers will be entitled to up to £10,000 each, to cover 70 per cent of their lost income during April and May to ensure they can continue to operate and sustain production capacity without impacts on animal welfare.

Minette BattersNFU President Minette Batters said: “Thankfully, the Secretary of State has heard our calls for help and is stepping in to prevent a catastrophe for the dairy sector. This package of support from Defra will help many iconic dairy farming businesses facing an uncertain future as a result of the impacts of the coronavirus outbreak. We know that the dairy sector is just one of many sectors that have been affected by Coronavirus, but we appreciate the hard work Defra has put in to secure this much-needed financial support for many dairy farming families who face losing their businesses.”

Environment Secretary George Eustice said: “Our dairy industry plays a crucial role in feeding our nation and we are doing all we can to ensure they are properly supported during this time.

“We’ve already relaxed competition laws so dairy farmers can work together through the toughest months, but recognise there is more to be done. That is why today we have kick started a new campaign to boost milk consumption and have announced a further package of funding.

“We will continue to stand alongside our dairy farmers through this difficult period.”

NFU dairy board chairman Michael Oakes said: “The NFU alongside other industry representatives have worked relentlessly over the past few weeks to ensure support reaches those hard-working dairy farmers facing immediate financial hardship due to the effects of market volatility.

“While this support package will be helpful for those farmers who are currently under considerable financial strain, we believe a combination of measures are needed in order to stabilise the industry’s viability for the medium and long term. Dairy farmers need much better contractual protection than they currently enjoy and that needs to be examined by government as a matter of urgency once we move to the recovery phase of the current crisis.”

The dairy sector is the UK’s largest farming sector, with milk accounting for 16.85% of total agricultural output in the UK in 2018. Since the start of the coronavirus outbreak, the dairy industry has faced challenges of excess milk, falling prices, and reduced demand from the hospitality sector.

Eligible dairy farmers who have lost more than 25 per cent of their income over April and May due to coronavirus disruptions will be eligible to access this funding for those qualifying months, with no cap set on the number of farmers who can receive this support or on the total funding available.

It comes as the Agriculture and Horticulture Development Board (AHDB) launches a £1 million marketing campaign to increase consumption of milk in UK households, funded jointly by the AHDB, Defra, the Scottish Government, Welsh Government, Northern Ireland Executive and Dairy UK.

The £1 million promotional campaign will to help increase sales of dairy products by encouraging the public to drink more milk.

Christine Watts, AHDB’s Chief Marketing Officer said: “This new innovative marketing campaign is a fantastic demonstration of what can be achieved when industry and Government join together to meet a common supply chain challenge.

“It will support dairy farmers and processors in driving demand for milk within households across the UK. It will link consumers’ love of the great taste of milk and dairy with how we are all having to manage these challenging times at home and at work.”