HEREFORDSHIRE dairy farms and those across the country are being forced to think seriously about their future due to concerns over insufficient returns, volatile markets and the scale of on-farm investment.

An NFU intentions survey shows that of nearly 600 dairy farmers, nine per cent of producers believe they are likely to stop producing milk by 2025, up from seven per cent last year.

A further 23 per cent said they were "unsure" if their business would continue producing milk beyond 2025, while 87 per cent of dairy farmers who responded said they are concerned about the impact of government regulation, with feed prices, energy prices, and cash flow and profitability other key factors that would curtail milk supplies.

Meanwhile, 91 per cent of dairy farmers said the main factor to them increasing milk production would be the scale of investment needed for things such as suitable slurry storage to ensure their farms are compliant - this supports the NFU call for Defra’s Surry Infrastructure Grant to be extended to cover more areas and to lower the minimum spend threshold needed to access the funding.

Hereford Times: Hope Mansell farmer Robert DaviesHope Mansell farmer Robert Davies (Image: Richard Stanton)

Hope Mansell farmer Rob Davies, NFU regional dairy board chair, said: “The fundamentals of the dairy markets remain positive in the long term with global demand continuing to increase but it is clear, from the survey results, that the resilience of dairy farmers is being tested by inflationary pressures, returns below cost of production and the increasing administrative burden.

“I think it is imperative that Government continues to collaborate with the NFU to ensure the dairy industry and other sectors can capitalise on future trade deals while not being constrained by unworkable environmental and regulatory legislation”.

“We have some of the highest levels of regulation in the world and we are tasked with and proud to produce milk in a way that is beneficial to the environment and has high welfare standards.

“With increasing pressure on production costs, it is vital the supply chain recognises the levels of investment required to achieve these world class standards, and that if the farm businesses are not able to make investments then they will not be able to continue producing.

“We do not want to see any gap in supply filled by imported dairy products that are produced to much lower standards, in the long term this will have impacts on us and is not sustainable.”

National NFU dairy board chair Michael Oakes, who farms at Rednal Birmingham but represents sector interests across the country, including in Herefordshire, said dairy farmer confidence was under pressure and that could also be extended to other sectors.


He said: “It’s clear that significant inflationary pressures combined with below cost of production prices are continuing to put the resilience of British dairy farming businesses under threat. We are now facing a crisis of confidence among Britain’s dairy farmers.

“The results of this survey show that, now more than ever, we need resilient and collaborative dairy supply chains. It’s vital we reverse this trend of boom or bust and invest in our supply chains. New industry-wide regulation on contracts, expected to be introduced later this year, must support fairer, more transparent and accountable supply chains. But regulation isn’t a silver bullet.

“With increasing global demand for British dairy, we know that the long-term future is bright for our sector. To ensure we maximise this potential, it’s imperative that government continues to work with us to ensure we have the right environmental, regulatory and trade framework in place to support the production of high quality, nutritious and sustainable food.”