In the wake of the ‘dairy crisis’, sparked when major processors in the dairy supply chain announced a second round of cuts to farm-gate milk prices in the space of two months, the Scottish government has unveiled a five-point action plan to tackle pricing issues. Rural Affairs Secretary Richard Lochhead announced the strategy today; just two days after industry leaders arranged an ‘emergency dairy summit’ in Westminster.

Following a meeting between Mr Lochhead and representatives of NFU Scotland, the rural Affairs secretary said he will call together a meeting with his UK and Welsh colleagues to take place ahead of the Royal Welsh Show. Mr Lochhead expressed support for Scotland’s dairy farmers and said the meeting with NFUS was aimed at relieving the pressures of the current pricing crisis and finding ways to help farmers in the face of plummeting prices and rising costs.

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The Rural Affairs secretary’s comments come in almost direct contrast to those made by UK agriculture minister Jim paice at Wednesday’s dairy summit. Paice was heavily criticised and booed loudly throughout his speech, in which he took a radical neoliberal line. The minister suggested those in the dairy industry could cut production costs further and chase export and added value processing markets instead of “battling over bottling” contracts for supermarkets.

Although he expressed support for a voluntary code of practice, such as exists in the grocery supply chain and has been advocated by the NFU, the minister declined to extend crucial solidarity to the hard-hit dairy farmers. He said, “government ministers can’t fix prices and I don’t believe we should” and claimed the UK government has no greater power to set price than is already offered in the EU regulations.

The Scottish plan unveiled today includes:

* Calling for a ministerial summit to discuss the current situation and establish a timetable for consulting on legislation

* Asking Defra Minister Jim Paice to appoint an independent objective facilitator to assist with the current negotiations between producers and processors in an effort to agree a voluntary code of practice

* Writing to retailers demanding clarity for consumers about how much producers receive for their milk

* Commissioning a long-term strategic review to establish where the dairy industry wants to be in 10 years and how to get there

* Ensuring the Scottish Agricultural Organisation Society (SAOS) have sufficient resources to accelerate their existing work on producer organisations and co-operatives

Speaking yesterday before he unveiled the plan, Mr Lochhead said, "This afternoon’s meeting with the NFUS was constructive but only served to further highlight the need for urgent action to tackle the issue of dairy prices. I was left in no doubt about the anger and frustration our dairy farmers are feeling and I can understand why they feel so aggrieved.

"I’ve been working hard to find a solution that better meets the needs of our dairy farmers and today’s meeting with the NFUS was part of that. We must find a way to maximise the potential of this sector while also ensuring farmers are paid a fair price for a valuable product.

Echoing calls made earlier in the week by farming representatives, the minister added that players throughout the dairy supply chain have a responsibility for its health and sustainability; he said, "Every part of the supply chain has a part to play in finding a solution to the current problem, including retailers and supermarkets."

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