I’m fed up with talking about the weather, but I can console myself with the fact we have grabbed every opportunity so far and progress is not too bad.DFB producers face cash crisis as farmers lose May milk cheques
DAIRY Farmers of Britain (DFB) producers have been left facing a crisis after they were told they would not be receiving their May milk cheques after the co-operative went into receivership.
The co-op's 1,800 members stand to lose their month's payment on top of the tens of thousands of pounds many of them had invested in the firm, leaving some farmers facing financial ruin.
Farmers Union of Wales dairy board chairman and DFB producer Eifon Huws said he was ‘devastated' by the news and now stands to lose more than £30,000.
He said: “I am in shock, total shock. I have lost £13-15,000 in losing the May milk cheque and add to that the £18,000 or so I had invested in the business and that is money I simply cannot afford to lose. It will have a devastating effect on the business.”
NFU dairy board chairman Gwyn Jones said he was ‘furious' at the news members would not be paid for May deliveries. He said the NFU would do everything it could to support members in finding a new outlet for their milk.
DFB was put into receivership by its bank HSBC, after it was unable to pay its debts. It will now be managed by PriceWaterhouseCoopers (PWC).
PWC receiver Stephen Oldfield, who will be responsible for running DFB while it looks for a buyer, said producers would not be obliged to fulfil their contracts with the co-op but are free to supply milk to other processors.
He said: “I do not wish to handcuff members to their contracts. We will be issuing new contracts which will cover an initial two-week period and will then be renewed on a rolling four-week basis.
“Members have to make the choice to sign that contract or find other processors to take on their milk.”
He confirmed there would be no base price set on the new contracts but they would instead be based on the price received from DFB's customers.
Many producers however will now be looking for a new buyer. While a number of the major milk processors have indicated their willingness to take on more volume, some farmers in more outlying areas could still struggle to find a buyer.
David Handley, chairman of Farmers for Action said: “There is a demand for milk so a lot of that will get picked up. The people I think are really going to suffer are those who are not near another processor and won't be able to find a buyer.
“They are the ones who will now be faced with getting out of the industry altogether and that is a real loss for the entire industry.”
For the latest news and reaction on the DFB announcement keep checking www.farmersguardian.com
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