Welsh dairy farmers see potential in producer structure

A GROUP of Welsh dairy farmers are convinced that the Dairy Producer Organisation (DPO) structure should play an integral part in the dairy sector’s future. The claims come after AHDB Llaeth/Dairy commissioned Promar International to carry out a study into “The Feasibility of a Dairy Producer Organisation in Wales” on behalf of the Welsh DPO working group. The group started to explore the potential of DPOs in Wales in May 2014 with the support of Agrisgop. The aim of the study was to gain a better understanding of how a DPO structure could work for the benefit of dairy farmers and processors in Wales. DPOs are specific entities set up primarily to negotiate prices and terms and conditions of supply with one or more processors. The report considers the potential of different DPO structures, the Welsh dairy industry and the challenges around establishing DPOs. The working group wants to encourage the industry to “step-up” to the challenge of driving the development of one or more DPOs in Wales. Working group member, FUW member Tom Jones, said: “As a group we want to see a more resilient, competitive and sustainable dairy industry here in Wales in the future and we strongly feel that DPOs could solve a number of the current issues within our supply chain. “For example, there is currently a disconnection between what processors need, and believe they can market, and the level and pattern of farm production. “This study goes a long way in acknowledging that by using new and novel methods of working together, DPOs can play a vital role in improving the efficiency of producer/processor relationships for the benefit of both parties.” The study emphasises that recognition, cohesion, patience and confidence are all fundamental aspects needed to establish successful DPOs. Good leadership and relevant skills are also cited as critical aspects of any success. The report can be found on the AHDB Dairy website: www.dairy.ahdb.org.uk/Wales/DPO

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