NFU dairy board chair Mansel Raymond yesterday said significant changes have been wrought in the British dairy industry since the events of the summer of 2012. Mass protests, publicity campaigns and lobbying secured better conditions for farmers, where were facing price cuts which would have seen returns for fresh milk fall 5 pence below the cost of production in some cases.

Mr Raymond said that around 85 per cent of milk procurement volume is now signed up to the Dairy Industry Code of Best Practice for Contractual Relations, which was established in negotiations at the end of last summer's dairy protests. Though the union had previously accused processors of 'cherry picking' from the code, he said on Tuesday that major milk buyers are now developing modern dynamic milk pricing mechanisms.

Raymond used figures from around the world showing rises in the value of dairy products. Dairy prices drove world food prices up last month, after 5 months of relative stability. He added, "There is only one way in which the price of milk should go - and that is up. The backdrop to all this is that farmers are emerging from one of the hardest farming years in decades. Recent industry estimates put feed cost alone up by over 2ppl this winter as a result of higher inclusion rates and costs."

He continued, "Our message is a simple one to all those who buy, use and sell the milk that farmers produce. Farmers need and deserve a market price that fairly reflects the growing value of raw milk, that allows them to reinvest and that gives confidence for the future. Any part of the UK market that fails to achieve that risks losing supplies of dairy products to those companies who are taking the future of the British dairy industry seriously; that will be my message to retailers and food service companies in forthcoming meetings."