The dairy industry is set to join together to address challenges in the sector following the Government’s announcement that it will temporarily relax some elements of competition law to support the industry.
The new legalisation will allow the dairy industry to adapt to the challenges presented by the coronavirus pandemic, with changes in the supply chain caused by decreased demand from the hospitality sector and reduced collection by retailers representing key issues.
Competition rules were already relaxed to allow suppliers, logistics services and retailers to work together, but this latest announcement will allow for dairy farmers and producers to collaborate further to ensure that they can avoid surplus milk going to waste.
The collaboration could include sharing facilities and labour, as well as co-operating to reduce production temporarily or identifying any hidden capacity in the supply chain for processing milk into other dairy products.
The Agriculture and Horticulture Development Board (AHDB) will work together with Dairy UK to lead the industry-wide co-operation, identifying any spare capacity, as well as how to reduce any production and stimulate demand.
The dairy industry is the UK’s largest farming sector, with milk accounting for more than 16 per cent of total agricultural output, while dairy farmers produce over 40 million litres of milk every day.
George Eustice, the Environment Secretary, said: “Our dairy industry plays a crucial role in feeding the nation and it is essential that they are able to work together at this time.
“We’ve heard loud and clear our dairy farmers’ concerns which is why we are further suspending competition rules law to allow dairy farmers to work together on some of the most pressing challenges they are facing. I am also urging farm businesses to access the loans that are available from their bank to support them in this period.”