Newsletter Archive:
| Chairman's View |
 Reading industry press coverage recently, I have been struck by two points.Firstly, our decision to commission Promar to do cost of production analysis has proved a good one. The timing of the report has been particularly opportune in focusing the minds of our customers, especially when some of them had been talking about price cuts until very recently. However, even this report that we launched last month is starting to look conservative on cost increases with feed and fertiliser maintaining their upward climb. Secondly, while on the face of it Wiseman Dairies and Dairy Crest’s trading updates at the end of March simply said that they were trading in line with expectations, the language in relation to the cost pressures on producers was interesting. They have both echoed our Promar report and recognise the increased cost pressures. Wiseman has been particularly bullish about the fact that they must raise their milk price to “ensure we have sufficient milk to meet our requirements in the forthcoming year.” Our sales teams are currently negotiating hard to achieve price increases from the marketplace. Everyone in the supply chain is attempting to keep costs down, despite the overwhelming facts showing the tightness of milk supply, but as I said in my recent letter to you, we will not shirk from the task in hand. |