Muller set to address rocketing Scottish Milk output

Muller has an oversupply problem in Scotland which it is tackling this month having experienced a 25% surge in milk supplies from its 230 Scottish farms which is way ahead of demand during the past 5 years.

This equates to 180 million litres of additional milk equivalent to 33 litres of extra milk per person living in Scotland. 

By my calculations thats 6,316 tankers a year @ 28,500 litres with each trip from Bellshill to Manchester (Muller’s most Northerly English dairy) amounting to 410 miles return. The simple arithmetic is that this means an eye watering 2.6 million lorry miles year.

In addition to the financial implications of trucking the surplus milk to England there are serious environmental costs which are unsustainable and particularly unacceptable to consumers.

Some Muller producers have apparently doubled production in that time with one almost tripling and we are talking multiple millions of extra litres coming from individual farms in many cases. Most have expanded with many choosing not to check what demand for fresh milk is doing in Scotland with Muller prior to making their long term investments.

Ian put a number of direct questions to Muller some of which were answered including the fact that there is no distinction between the volume expansion between aligned and non aligned Muller suppliers both have expanded in parallel.

In addition Muller have not recruited in Scotland since 2013 so no increase from new arrivals.

The review, or rather the solution, is anticipated by the end of the month and it’s likely the end result  will be a cocktail of measures some of which may be painful and unpalatable  for some producers.

Ian believes transport charges exclusive to Mullers Scotland Farmers could be one result plus the likely ditching of volume incentives and the serving of termination notices to some producers. For any farmer unfortunate enough to be served notice it could be the end of the road with no where to sell their milk- worrying times.

One problem which appears difficult to negotiate is the offenders might not be the ones or the only ones who are penalised. 

Others in the frame as encouraging and trumpeting Scottish milk expansion include NFUS. For example in 2013 they called for a doubling of Scottish milk production to 1.6 billion litres by 2025 (when the average farmgate milk price was over 30pp!) but interestingly little mention was made of profitable outlets for this enormous quantity of extra milk.  The golden rule is markets and customers first as in demand led expansion.  

Only this week the NFUS Scotland’s President confirmed that NFUS has “the ambition to double the size of the farming, food and drink industry in Scotland to £30 billion”