Do the Muller numbers stand up to scrutiny

Several Muller farmers were quick to contact Ian raising questions about the Muller Scotland production figures and their proposed remedies.

AHDB issued a Scottish milk surplus update last Tuesday confirming that

“Milk Collections of farms in Scotland are estimated at 1,478 million litres in 2018/19 an increase of 55 million litres (+4%) compared with 2014/15”.

Compare this to the Muller press release where Muller stated

“Production from Scottish farms who supply us (Muller) however is up by 25% since 2014 as a result Muller is transporting 180 million litres per annum to dairies in England”.

If these figures are accurate it means Lactalis (The Fresh Milk Company), Grahams Dairies, First Milk & Woodcocks, Arla Lockerbie plus others have all lost significant volumes during the same period!

That alone should trigger challenges on the accuracy of the two sets of figures.

Meanwhile, some Muller producers are claiming Muller provided them with letters confirming they required the extra milk. The letters were requested by farmer’s bankers in order to facilitate bank funding for expansion. “So Muller knew and accepted the extra milk was coming”.

This has prompted some to claim that if Muller management didn’t realise the volumes were coming down the pipeline then it’s a management failure.

Add to this the fact that Muller farmers have informed Ian that they all have to submit 15 month advance production forecasts.  Failure to submit is non negotiable and in the event the forecast is out of kilter to the actual producers suffer a price penalty on a sliding “accuracy scale” based on a percentage variance (%).

The forecasts are contracted and submitted quarterly.

On top of that the Muller contract obliges producers to give a minimum 3 months advance notice of any intention to significantly increase milk production by 10% or more.

Another subscribes to the conspiracy theory that it’s all simply a plot to terminate some contracts and “to cut milk prices (sorry haulage charges)”.