THE man in line to take over at the helm of First Milk has outlined his vision for the future of the co-operative.

In an interview with the Western Telegraph, chairman designate of First Milk, Sir Jim Paice, said the business is heading in the right direction to face the challenges of the future and he urged farmers to keep faith with the co-operative as it becomes more competitive.

Former farming minister Sir Jim Paice is set to become chairman of First Milk at its AGM next month, following the retirement of Bill Mustoe, and he has already developed a real enthusiasm for the business.

He said: “I’ve always taken the view that farmers should take more control of their own destiny so the principles behind First Milk are absolutely right for the future.

“Obviously the company’s been through difficulties, as indeed the whole sector has in the last year, and there have been problems with members wondering whether they’re making the right commitments, but I think the events of the last few months and the latest announcement of the price rise should allay those concerns.”

First Milk often finds itself at the lower end of the price tables, but it is seeking to become more competitive, and earlier this week announced a 1ppl price rise from November 1st, taking its standard litre price to 32ppl for its manufacturing pool and 31.85ppl for its liquid pool. The successful launch of its Lake District Dairy Co Quark soft cheese and recent arrival of new fresh fruit and milk drink Frumoo have also helped pave the way for the company to pay out a record 5% dividend to its members. And with competition for milk hotting up across the country, Sir Jim urged farmers to look beyond the headline figures and consider the added benefits that First Milk can offer.

He added: “To have a stake in the future is worth a great deal and when farmers are being pestered by other processors for their milk they need to think well what else do I get and the answer is nothing, whereas with First Milk they get a dividend, they get a stake in the future and a share of the balance sheet and as that balance sheet hopefully increases they’ve got a capital asset that’s worth having.”

‘Think twice before jumping ship’

FIRST Milk’s commitment to sustainability and ‘adding value’ to their members’ milk in order to build a secure foundation for the future was also cited as a reason why farmers should stick with the business.

Sir Jim said: “I want to demonstrate to those farmers who have actually gone away or been tempted by a carrot that actually what they’ve left behind is now doing very well and they may regret it, and if they do want to come back to us we’re very willing to talk to them.

“To those who may be thinking about going elsewhere, I think the message has to be what are you losing by moving, in terms of what are you giving up and what sort of deal are you getting, not tomorrow, but in the future? For example, is the price you’re being offered what you’re going to get? I’ve heard many stories of farmers having a price talked at them, then there’s a deduction for this, there’s a deduction for that and they end up with something considerably less.

“A second point is, where are you going in the future? If the dairy industry goes into another downward cycle, what are they going to be paying you then, indeed are they going to want your milk then? Whereas our factory’s been in west Wales for 70 years, so we’re not going anywhere, we will still be wanting their milk. I think farmers should be thinking twice before they’re tempted to jump ship.”

In west Wales, many farmers are being assured that they can look forward to receiving more than 32ppl, but First Milk is also offering a helping hand to producers who may not be achieving the standard price.

“We estimate that the majority of our producers in this area - because they’re producing for quality and we’re paying for that quality and that’s what differentiates us from some of the others - will actually increase their actual price to in excess of 33ppl,” said Sir Jim.

“For those farmers who won’t be getting as much as that, the message has to be we will help you do that and that’s where this issue of sustainability and our field force are so important because I think it’s part and parcel of being a co-operative that the organisation has to help our members to improve quality to address the issues that means they’re not getting as high a price as they could be. All of that is being part of a business in which you have a stake and I think that sets us apart from all of the rest.”

Well-placed to deal with challenges ahead

THE uncertainty of what will happen to the UK dairy market after the abolition of quota in 2015 currently looms large in most people’s minds within the industry, but Sir Jim is confident that First Milk is well-placed to deal with the challenges ahead. As well as producing mass volumes, First Milk’s acquisition of sports nutrition business CNP Professional and diversification into premium brands, are all coupled with ambitions to tap into the burgeoning export market, having recently opened an office in Hong Kong.

Sir Jim added: “The world is still an open book, particularly for branded products, but also for good quality British food and we’re going to be out there fighting in those markets. That’s another reason why I think we’ve got a good long-term future - we’re not just looking inwardly at bottled milk on the doorstep or in the supermarket, but at a global marketplace for our products.”

Bringing leadership and communication

IF ALL goes well, Sir Jim will take his place in the hot seat at the end of October and he is looking forward to putting his 25 years of experience in dealing with people and developing key communication skills into action.

“I hope I’ve demonstrated very clear leadership of the industry over the last few years whilst I was minister, and I’ve got an absolute commitment to the principles behind First Milk,” he said.

“I guess I bring the ability to talk to farmers, communicate with them, understand them, which is essential if we’re going to take our 1,700 plus members with us and keep them with us and ensure that they benefit from being part-owners of this exciting business.”

First Milk’s AGM is being held in Telford on October 31st.