Over a third of dairy farmers in Wales have been 'severely impacted' as a result of the impacts of the coronavirus outbreak, according to NFU Cymru.
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Herd of British Friesian cows grazing on a farmland in East Devon, England

The union has called for ‘urgent interventions’ to support Welsh dairy farms due to the effects caused by the Covid-19 pandemic.

The virus has seen the almost complete loss of the food service and hospitality markets, as well as increasing price volatility in global markets, which has left farms and processors under increased pressure.

This has led to some dairy farmers receiving significant price cuts, delays to payments and, in some cases, no other option but to dispose of milk on farm because the processor is not collecting it.

NFU Cymru Dairy Board Chair Abi Reader and NFU Cymru Deputy President Aled Jones are involved in a dairy focus group that Welsh government has established.

In meetings of the group this week, the pair have stressed to the government the urgency and gravity of the situation.

Ms Reader, a dairy farmer from Wenvoe, Vale of Glamorgan, said over a third of dairy farm businesses in Wales have already been ‘severely impacted, and this number is growing’.

“We can envisage this number rising with more processors dropping their milk prices for May,” she said.

“As cows begin to go out to pasture milk production is increasing daily and we expect to hit peak production in mid-May.

“We need to move fast to mitigate the impacts of this unfolding crisis on dairy farming businesses across the country.”

A key issue raised is that farmers and processors largely cannot access the Welsh government and UK Treasury schemes designed to help businesses through this crisis.

Farms cannot furlough staff or stop milking cows, and things like business rate holidays don’t apply, Ms Reader explained.

Welsh government has been urged to extend the eligibility of these schemes so that they can be utilised by those businesses in the dairy sector who are losing significant income

Ms Reader said: “It’s important for everyone that we protect the UK dairy sector so when our cafes and restaurants open normally again, we have the dairy farmers in business with the capacity to produce milk that forms the basis of healthy and nutritious dairy products which are loved by the nation.”

In a meeting this week with Minister for Rural Affairs Lesley Griffiths, Aled Jones called on Welsh government to take immediate steps to ensure the sustainability of the dairy sector in Wales.

“We need a government-backed scheme that can take distressed milk off the market for the next two months until we return to some normality in the sector,” he said.

“We also need specific support for Welsh dairy farmers whose businesses are adversely affected by what is happening out there in the market.”

What are dairy farmers’ key asks?

• Grant scheme for Small Businesses and Economic resilience Fund to be made available for dairy farms affected by coronavirus market disruption.

• To engage with the EU Commission about schemes such as PSA, production reduction and market promotion to help restore confidence in the market and prevent adverse publicity related to disposal of milk.

• Governments across the UK to work together to help the industry through this crisis. UK government has a role to play in convening key stakeholders and helping to manage flows of milk through the supply chain by helping with measures such as competition law.

The potential sale by Fonterra of its Australian operations could have implications for the course of Australia’s entire dairy sector over the next five to 10 years, according to ANZ’s latest Agri Commodity Report.

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