Reforms will benefit local milk producers (From Western Telegraph)

Reforms will benefit local milk producers

Dairy farmers producing milk cheaply in pasture-rich Pembrokeshire will have a competitive edge on producers in other parts of Britain when CAP reforms are implemented, suggests an industry analyst.

Tony Evans, who acts as a consultant to numerous farm businesses in Pembrokeshire, believes there are great opportunities for low cost producers.

"We have to be able to stand a lower cost because we are without doubt going to get lower returns," said Mr Evans, of Andersons.

"Farmers in other parts of Britain can't get near Pembrokeshire's low cost producers because of their higher wage levels, cost of living and climate. In this county, farmers can produce milk cheaply and there is the supply profile to meet demand."

The mid-term review of the Common Agricultural Policy is potentially one of the most powerful changes to the dairy regime since the introduction of milk quotas.

But what does that mean for milk production in Pembrokeshire? "There will be changes but they will take longer to implement than has been suggested," Tony Evans believed. "The pain will be less but the rewards will also be less."

Opportunities for increasing productivity of land in Pembrokeshire was an issue farmers must explore, he insisted.

"If they can demonstrate that this is achievable they could be entitled to more quota to keep the economy buzzing."

But if the current proposals are agreed less milk will be processed into butter. The intention is to slash intervention stocks from 190,000 tonnes to 30,000 tonnes. This reduction will create a surplus of milk and put pressure on the milk price.

"Farmers have a big challenge here," said Tony Evans. "The biggest problem in west Wales is that the population density is not high. Suppliers of liquid milk in this area are a last resort rather than a first choice.

As a result milk is being processed locally unless it is required elsewhere for a higher value product or if there is insufficient processing capacity in this part of the world. As an industry we need to cherish and nurture the liquid milk market."