Struggling dairy farmers 'face collapse' as milk price drops

Industry fears as some farmers could struggle to break even due to milk price cuts and high output costs.

Dairy farmers say they’re facing the most uncertain period in years as the price of milk plummets.

Milk buyers made announcements in April that significant cuts would be made to the value of milk.

One major buyer from June will make cuts of around 10%, meaning farmers will be paid less for the amount of milk they produce per litre.

Bruce Mackie, who runs Rora Dairy in Aberdeenshire, said prices have returned to what they’d deem normal after a boost last summer, when milk prices rose in line with the scarcity of milk.

However, output costs like diesel and fertilised haven’t come down, narrowing their profit margin.

He warned that smaller farms may have to consider how viable their businesses will be, as some could struggle to break even.

Mr Mackie told STV News: “We would have seen prices at around about 37p at this time last year and that rose to about 55p tops.

“It’s come back down so we are back to where we were 15 months ago or so, but the problem is that that the costs haven’t come back down to create that margin.

Dairy farms are struggling to cope due to milk price cuts, union chiefs saidGetty Images

“There are undoubtedly farmers who don’t make money and if we look at the amount of subsidy that farm income makes up, a lot of farms is greater than the subsidy that they make.

“If those costs are bigger, then undoubtedly that will have an impact on the industry and farming in general.”

Many are having to diversify their business to make ends meet, with Rora Dairy now producing their own line of organic yogurt.

The National Farmers Union of Scotland north east representative Lorna Paterson said the price drop is bad news for the workforce.

“At the moment, people do not know what is ahead,” she said.

“They are having to make decisions because they can’t stand still, and they don’t know if their decisions are viable or otherwise.

“People worry about things like that. They sometimes don’t show it, but they do worry and that puts pressure on relationships – be it with their staff or their own family.

“For sure, it puts huge pressure on their own mental wellbeing.”

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