Farming unions in Wales are raising alarm bells as dairy prices experience a significant decline. The Farmers’ Union of Wales (FUW) reports widespread anxiety among dairy farmers following a sharp drop in milk prices throughout the autumn months. With processors indicating further price reductions heading into the new year, many farmers fear that the situation could worsen, leaving them vulnerable amid an unstable market.
Average milk prices are projected to fall between 30 to 35 pence per litre, while a previous report from Kite Consulting estimated production costs to range from 39 to 44 pence per litre. This disparity suggests that typical dairy farms in Wales could incur losses amounting to thousands of pounds each month if these trends continue.
Urgent Calls for Action from Farming Leaders
Gerwyn Williams, Chair of the FUW Animal Health & Dairy Committee, expressed the urgency of the situation, stating, “The speed and severity of this price drop are unprecedented. Farmers are facing an impossible situation where their input costs remain high while the value of their product plummets.” He emphasized the need for immediate action, calling for an emergency meeting to address the viability of family farms, which are at serious risk.
Williams cautioned that while some farmers may be able to endure short-term losses, the prospect of this crisis extending into the summer of 2026 could lead to business closures. He highlighted that many family farms have made substantial investments to comply with regulations and enhance efficiency, but such drastic price reductions threaten their financial stability.
Dai Miles, Deputy President of FUW, underscored the broader implications for rural communities. “Dairy farming underpins thousands of jobs in Wales and plays a vital role in the economic, social, and environmental fabric of our rural areas,” he stated. He noted that when dairy prices fall sharply, it is not just farmers who feel the impact; local businesses and entire communities are also adversely affected. Miles urged the government to collaborate with the industry to establish immediate stability and develop a long-term strategy for resilience.
Industry Response and Fair Practices
In response to the crisis, NFU Cymru has taken proactive steps by penning an open letter to milk processors, urging them to act responsibly during this challenging period for the dairy sector. The letter stresses the necessity for milk buyers to adhere to fair dealing legislation, ensuring transparency and open communication with suppliers.
Jonathan Wilkinson, Chair of the NFU Cymru Dairy Board, stated, “With many dairy farmers facing a difficult winter, it is of the utmost importance that the dairy supply chain functions in a fair and transparent way.” His sentiments were echoed by Paul Tompkins, Chair of the NFU Dairy Board, who remarked, “This is the first real test of the new contract regulations; the first time the sector has had an Adjudicator overseeing compliance with the regulations.”
Farmers are now empowered to request explanations for any adjustments made to their milk prices, ensuring that changes align with their contracts. Tompkins emphasized the need for dairy farmers to engage actively with their buyers and the new regulations during this critical time.
As the dairy industry grapples with these unprecedented challenges, the focus remains on safeguarding the livelihoods of farmers and the sustainability of rural communities in Wales. The call for immediate action and collaboration between stakeholders is crucial to navigate these turbulent waters and restore stability in the dairy sector.
