MILK PRICE RISES DID REACH FARMERS - BRC

7 December 2007

The British Retail Consortium (BRC) is refuting claims by the Office of Fair Trading (OFT) that increases in retail milk prices implemented by leading supermarkets in 2002/2003 had no effect on the price farmers received for milk.

The BRC points out that data from the Milk Development Council shows between June 2002 and December 2003 the average farmgate price rose from 15.3 pence per litre to 19.1 pence per litre, reflecting the increase in supermarket prices.

British Retail Consortium Director General Kevin Hawkins said: “This is clear evidence that the increases in retail milk prices introduced by supermarkets benefited farmers as they were meant to.

“The fact that these increases could not be sustained in subsequent years was not supermarkets’ fault but reflected continuing instability in the UK liquid milk market, in particular the structural imbalance between supply and demand.

“The global market has now corrected this and farmgate prices are now substantially higher. If the OFT are claiming supermarket price rises did not reach farmers they have not looked at the figures.”

Milk Development Council figures show average farmgate milk prices had reached 23.1 pence per litre by September 2007

Media Contacts: BRC Press Office 020 7854 8924 Out of hours 07921 605544