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Cheap milk is not just about cash

21 August 2015

The crisis is environmental and social, says Paul Vallely

HOW has it come to this? Cows have been paraded down supermarket aisles. Farmers have taken bottles of milk from fridges, piled them in trollies, and then abandoned them at the checkout. We have even had a bishop on Thought for the Day talking about the price of milk.

It is all because the supermarkets have been paying British farmers about 4p less for a pint of milk than it costs the farmers to produce it. What is the explanation for this economic nonsense? Advocates of unfettered capitalism say that it is perfectly clear. Too many milk producers are producing too much milk, and so the price had fallen. When farmers switch to producing something else — or go bust — and there is less milk around, then the price will rise again. This see-sawing is how supply and demand works. It is called the free market.

There is slightly more to it than that. Milk has become a global commodity. The farmers in Cheshire, where I live — and who have created the countryside that forms the backdrop to my rural outings — are in competition with producers around the world. But demand for cheese has fallen off in China. And Russia has banned the import of EU dairy products in retaliation for the sanctions imposed by the West after Moscow’s invasion of Crimea and hostility to Ukraine. So there is too much milk around, which forces the price down — nowhere more so than in some supermarkets that ruthlessly exercise their bulk-buying muscle.

The problem with leaving all this to the market is that it squeezes the “less efficient” farmers out of the game. Efficient here means the big agri-business operators who intensify production to squeeze the maximum from the animals and the land, in ways that are unfriendly to the environment. The farmers with small herds — and land-management programmes that minimise agro-chemical pollution and allow wildlife to thrive — are the ones who are going bust. In the past ten years, the number of family farms has halved.

This is a classic example of the problem that Pope Francis identifies in his encyclical Laudato Si’ (News and Comment, 19 June; Comment, 26 June). In the hours just before it came out — billed in advance by the media as a document on climate change — it was, the Pope told close advisers, an environmental document, but a social one.

Market economics has taught us that the world is a resource to be manipulated for our gain. This has led us into unjust and exploitative economic systems, which the Pope condemns as indifferent to the powerless, the poor, and the planet alike. This world-view makes profit the primary, and often the only, criterion by which to measure human economic activity.

The true price of cheap milk is more polluted water, fewer birds and butterflies, and a threat to the small family farms that have shaped the fields and hedgerows, lanes and hamlets in which we take our recreation. We have Fairtrade tea, coffee, bananas, and sugar. Perhaps it is time we had Fair Milk.

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