Evolution Farming

[crashbox]

I'm not a milk producer, so need educating.

How do many existing contracts work? Can you supply endless quantities of milk at a set price? Or is there some sort of cap. Presumably Tesco only need so much milk?

Can you supply as much milk as you like?

Yes. Some suppliers pay a premium for a "level profile" (similar amount of milk every month of the year).

Can the processor pay you what they like?

Yes. The majority of contracts do not stipulate a minimum price, and if a company wishes to, it can pay you 1 penny per litre next month. They are unlikely to do this unless facing a major cash crisis, as you will leave them as soon as you can (often 12 months' notice) or go out of business very quickly.

 

[Grass And Grain]

Can you supply as much milk as you like?

Yes. Some suppliers pay a premium for a "level profile" (similar amount of milk every month of the year).

Can the processor pay you what they like?

Yes. The majority of contracts do not stipulate a minimum price, and if a company wishes to, it can pay you 1 penny per litre next month. They are unlikely to do this unless facing a major cash crisis, as you will leave them as soon as you can (often 12 months' notice) or go out of business very quickly.

Thanks for explanation.

You've to give them 12 months notice to quit, and they can pay you what they like in the meantime. That's bonkers!

They need telling we're not going to agree to those terms.

 

[crashbox]

Thanks for explanation.

You've to give them 12 months notice to quit, and they can pay you what they like in the meantime. That's bonkers!

They need telling we're not going to agree to those terms.

Correct.

Hence about a decade's work on this:

Dairy contract legislation – essential information

For most dairy farmers, their contract to sell milk is the single most important piece of paper they have for their business and shapes the relationship with their milk buyer. Read our explainer on the new legislation.

www.nfuonline.com

Would not have gotten off the the ground without significant effort by some key individuals.

 

[ollie989898]

Happy stock is productive stock

Happy stock= happy farmer. Unstressed cows-unstressed farmer. The fates of both are interlinked.

 

[Enry]

Thanks for explanation.

You've to give them 12 months notice to quit, and they can pay you what they like in the meantime. That's bonkers!

They need telling we're not going to agree to those terms.

They would have to pay you whatever their contract price was in that time, but may legally remove some bonuses. Heard of someone who was on a fancy ice cream contract through a not so fancy NW based processor and when they gave notice they reverted to standard contract with no Icecream top up.

 

[Scholsey]

They would have to pay you whatever their contract price was in that time, but may legally remove some bonuses. Heard of someone who was on a fancy ice cream contract through a not so fancy NW based processor and when they gave notice they reverted to standard contract with no Icecream top up.

A milk buyer we were with, admittedly 12-13 years ago had quite a few people with their notice in, they put the price up but said increases didn’t apply to anyone with their notice in!

 

[Enry]

A milk buyer we were with, admittedly 12-13 years ago had quite a few people with their notice in, they put the price up but said increases didn’t apply to anyone with their notice in!

Sneaky bAzdards…probably not legal but they get away with it

 

[Grass And Grain]

A milk buyer we were with, admittedly 12-13 years ago had quite a few people with their notice in, they put the price up but said increases didn’t apply to anyone with their notice in!

Sneaky bAzdards…probably not legal but they get away with it

Hope these new contract laws help with these sort of shenanigans.

This is interesting. Could it be rolled out for every dairy farmer in the UK?

https://saos.coop/what-we-do/milk-suppliers-association

 

[Princess Pooper]

Can you supply as much milk as you like?

Yes. Some suppliers pay a premium for a "level profile" (similar amount of milk every month of the year).

Can the processor pay you what they like?

Yes. The majority of contracts do not stipulate a minimum price, and if a company wishes to, it can pay you 1 penny per litre next month. They are unlikely to do this unless facing a major cash crisis, as you will leave them as soon as you can (often 12 months' notice) or go out of business very quickly.

Not all contracts allow you to produce as much milk as you like, we have a 'quota' and any surplus has to be agreed in advance with the dairy (the answer is not necessarily 'yes', surpluses not agreed are penalised.

And you can't always say 'OK I will hand my notice in and find another customer' as in some areas there are no other customers running tankers, or they might have full books and are not recruiting!

 

[Matty_r]

Is your real name Tom rawson?

I’ve managed to feed my cattle all winter despite depressed milk prices.

Plenty of others even with a lot worse milk prices than Arla have achieved have looked after there animals. There’s literally no excuse for what they have been doing stop defending them.

last person to be doing what they did near us got jail time.

I got told mr rawson spent his winter driving his new posh truck and going shooting most of the time. I didn’t do any of that but I made sure my cows got fed.

News to me that mr rawson is a one for shooting and had a new truck, must be nice to have such reliable sources as proven with a lot of the statements in this group

 

[Nearly]

 

[Enry]

I agree milk prices need to be sustainable, but businesses need to build some resilience in if possible. Why keep expanding if already struggling to make a profit, given that one would have thought that even with the size of the individual herds they are probably at the top of the 'economies of scale' tree.

You need to consolidate before expanding further but they just seem to want to keep expanding.

They didn't make a profit - admittedly on tax accounts where they blame a change in valuation method - in calendar year 2022 when despite the drought, most dairy farmers seemed to do quite well so yes, I agree I think that they would really have struggled in 2023 with lower milk prices, but it is still not an excuse for poor welfare.

Organic so getting 8-10ppl more than most?

 

[Princess Pooper]

Organic is not necessarily more profitable though is it? Particularly in the last couple of years.

 

[Enry]

Organic is not necessarily more profitable though is it? Particularly in the last couple of years.

ah...you said "milk price"....profit is a different thing. ..either way, no excuse for animal neglect

 

[New Holland TM150]

What will happen to the unit in Leicestershire? Will they carry on?

 

[O'Reilly]

I know we're not supposed to be talking about this, but I can't understand, if the Cheshire farm is a contract run farm, the owner should provide a bank account and finance for the variable costs, as I understand it. Otherwise it's a tenancy. So why wasn't the money for feed available?
Bleasby is tenanted I hear, so that makes sense.