14 May 2020

Support for the dairy sector through Covid-19

Perhaps one of the hardest hit areas of the food and farming industry by Covid-19 has been the dairy sector, so the government support package announced in the last few days is seen as a lifeline.

The almost complete closure of the foodservice and hospitality industry resulted in the loss of millions of litres of milk each week and affected more than 75% of dairy farmers. This was causing severe financial hardship for farming families who were literally pouring their milk away.

Thankfully a support scheme has been announced in England, followed by a very similar one in Wales, where Lesley Griffiths, Minister for Environment, Energy and Rural Affairs, confirmed that eligible dairy farmers who have lost more than 25% of their income in April – and subsequently May – will be entitled to up to £10,000. Environment Secretary George Eustice said: “Our dairy industry plays a crucial role in feeding our nation and we are doing all we can to ensure they are properly supported during this time”.

The hardship package comes after a number of industry bodies, including the National Farmers Union (NFU), called for the government to do more for the industry. The Agriculture and Horticulture Development Board (AHDB) launched a £1m promotional campaign to support the dairy industry and gather the momentum required for action.

The Covid-19 crisis has also once again led to calls for better contractual protection than many dairy farmers currently enjoy.

Whilst the support acts as vital relief to hard hit farms, we are starting to see a move towards an easing of the intensity of the pandemic, which will be followed by a recovery phase. To stabilise the industry’s viability in the medium and longer term, it has been said that the package will have to be bolstered by a combination of other measures to properly and meaningfully aid recovery.

Further details on the scheme are due to be announced shortly.

The Agriculture and Rural Affairs team at Harrison Clark Rickerbys are here to provide advice and support to farmers and land owners during and after Covid-19 and, in particular, will be able to advise on any issues you may have concerning your milk contract.

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Bryn Thomas, Partner

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