United Kingdom: report on growth opportunities for dairy

In the United Kingdom there are enormous growth opportunities for dairy, according to a report of Kite Consulting. Given the UK’s strong track record in animal welfare and traceability, and its activity to reduce carbon emissions across dairy production and processing, and when the processing sector innovates, UK farmers have access to growth markets. This also because of UK milk prices and milk returns have become low compared to world market prices, particularly in the liquid sector. UK dairy processors can improve their returns by accessing growing global markets, which was not an option in the past. This introduces a new dynamic in the dairy industry, particularly in the liquid sector, where the price differential is greatest. If UK retailers want to secure long-term liquid milk supply from supply chain partners that are committed to fulfilling their decarbonisation objectives, then they need to act to ensure that they are providing a fair market return. Otherwise it seems unlikely that liquid milk as a retail loss-leader in the UK will remain viable, according to Kite.

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