Letter from Europe: Are Europe's dairy farmers moving away from confrontation?

Wednesday, November 4, 2009

European dairy farmers claim they've been producing below the economic break-even point for years and staging 'milk strikes' in protest. But this time some are ignoring the call to action

by NORMAN DUNN

European consumers seem to be getting very tired of so-called "milk strikes" – where dairy farmers protest against low producer prices by simply pouring their milk down the drain or by blockading and stopping deliveries to processing plants.

In early summer last year, there was more popular backing for militant action when milk prices slumped for months below €0.30 or 46 Canadian cents per kilogram. The price of production on the farm averaged 60 cents, claimed the European dairy farmers' association (EMB).

By end of May 2008, farmers not only stopped delivery, but also took to the streets to halt deliveries of supplies from non-protesting farmers. By day three of the German strike, for instance, an estimated one third of the country's 100,000 milk producers were withholding their milk deliveries.

Farmers in France, Belgium and Holland joined in. Even although the spot market price for raw milk – that is the free market – reacted by rising to 60 cents for a few days, the processors stood firm. They maintained there was too much milk being produced, the market was flooded and they were not aiming to pay a cent more for the product.
Apart from the doubtful achievement of establishing an image of rioting farmers disrupting food supplies to the consumer, the 2008 milk strike did precious little for farming folk. Small family-run European dairy farmers with maybe 30 cows haven't the reserves to give up income on a matter of principle, even for a few days. This quickly became very clear and the whole campaign collapsed.

But the biggest players in the European dairy scene – processors such as Sachsenmilch in Germany that lost out through days of farmer blockades at its 1.5 billion kilogram-a-year Leppersdorf plant – have neither forgotten nor forgiven. In fact, almost 15 months later, Sachsenmilch is still in court and currently suing farmers for the equivalent of C$1 million in damages arising from a few days' blockade.

But even as this case was hitting the headlines this fall, farmers throughout the European mainland were taking to the streets again in protest. Apart from a slight rise towards the end of last year, producer milk prices have mainly remained well below the claimed cost of production. In the third week of September, the EMB was asserting that 40 per cent of French farmers were on milk strike again and stopping deliveries to dairy plants.

Italian, Austrian, Dutch and Belgian farmers announced a solid week of demonstrations. German farmers joined in although, perhaps because of the ongoing Sachsenmilch damages court case, they were not quite so eager to start blockades again. But milk everywhere was once again being poured down the drains and ending in many a farm manure lagoon.

A noticeable exception to the militant milk nations in Europe has always been Britain. And, once again in September 2009, no similar protest action was being planned by farmers there. This despite the fact that the average producer price for milk in the British Isles has historically always been lower than that offered by processors on the European mainland. Just now this averages the equivalent of 40 cents a kilogram. Instead of being confrontational, British milk producers have become skilled at continually honing down production costs through fine-tuning grass silage-based systems mainly coupled to economies of scale.

True, there's a steady hemorrhaging of dairy farms in Britain. Last year, there was a five per cent drop in national milk production mainly because of this (the silage making season was particularly bad, too). Only the economically super fit survive and, out of a current 13,600 dairy farmers, an average of two per day are going out of business.

Meanwhile, back on the European mainland, farming organisations are by no means all militant. It was interesting to see in mid-September that the main farming organizations – the nationally recognized general farmer unions in Germany, France and the Netherlands – were this time working hard to stop the creeping consumer consensus that all farmers were back on the barricades and 100 per cent behind the milk strike.

For instance, the general farmers union in France reacted immediately in September to the dairy farmers' organization claims that 40 per cent of French milk producers were "on strike" by going to press with the news that it was more like four per cent!

Concern about the public image of farmers and agriculture as a whole; acceptance that the grass roots industry must bear more responsibility for meeting real market demands: Is this the new face of Continental European farming? If so, it's a welcome one for many agriculturalists getting tired of continual confrontation. BF

Norman Dunn writes about European agriculture from Germany.