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Milk prices: Supermarkets are 'wrong targets' says BRC

20 July 2012

As hundreds of farmers blockade dairy plants in anger at retail prices for their milk, the food sector finds itself divided between industry figures such as Jamie Oliver and Hugh Fearnley-Whittingstall and the British Retail Consortium, which says supermarkets pay well

According to statistics, the cost of a pint of milk exploded in 2008, which was around the time the recession started to take hold in the UK. Between 1991 and 2007, the cost of a pint hovered within a margin of error of 5p (being priced at between 32p and 37p), but in 2008, that accelerated to 42p a pint, and has now gone to 46p.

The supermarkets being targeted by the dairy farmers are Asda, Morrisons and the Co-operative which argue that they pay a premium above the market price charged by suppliers. However, Hugh Mr Fearnley-Whittingstall, one of the celebrity chefs who has come out in support of the farmers, told the BBC that the three chains had the "most punitive and least sustainable" contracts.

''Supermarket contracts with dairy farmers vary hugely,'' Fearnley-Whittingstall told the BBC. ''Farmers... are in no position to take industrial action or even leave contracts for fear of going bust immediately. Other businesses who buy large amounts of milk are also guilty of enforcing these harsh contracts - and we may expect to see more names revealed by dairy farmers and the NFU that represents them in the coming days.

''But the supermarkets are the biggest players by far, and if they were to lead with fairer contracts, there's a strong feeling that others in the sector will follow.''

The BRC, however, has laid the blame at the door of ''other purchasers'', with Sarah Cordey of the consortium saying that supermarkets were the "wrong targets" in the campaign. "Eleven of the 12 best paying customers for milk are paid by supermarkets and are under a lot of public scrutiny," she said.

"We are surprised that we don't see farmers or TV chefs asking important questions of manufacturers or the public sector about the price they pay for milk."

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