UK Dairy – Going Global

Jun 26th 2017

Part of the Pro-Leave Brexit campaign was an optimism that, freed of the EU, Britain would be free to pursue its own trade deals outside of the bloc.  Now that the negotiations have started, many industries will have started to size up the potential to do just that, but could the UK dairy industry have gotten a head-start on everyone else?

At the moment, the UK is the European Union’s largest customer, accounting for around a fifth of the EU’s total global exports, and is a valuable global market, importing around £2.5bn of dairy products from the EU in 2015.

Those purchasing butter, cream and cheese in the UK will already know that Chinese interest in those particular commodities has helped, along with reduced production and a smaller “spring flush” of milk this year, to push up prices here. While those exports continue, Chinese appetites may eventually find a rival in the form of India, the world’s largest dairy market, where AHDB’s export marketing program have been promoting British dairy products, including cheeses.

China is still a focus for exporters, however, and one company here in the UK has been gearing up to start exporting fresh milk there.  NEMI Dairy Ltd, which has been working with researchers from Reaseheath College to extend shelf life and preserve freshness in their milk, are hoping to be selling in China by the beginning of August.  If they can pull it off, it would make them the first British company to export milk there.

Prospects are therefore looking healthy for dairy exports, but this still leaves the problem of dairy farmers barely breaking even on farmgate prices for milk, which would pull the carpet out from under any potential gains we could make from this export market.  It may well be that, assuming that increased exports do not serve to pull prices up by themselves, if the UK wishes to capitalise on this overseas interest, it needs to support our dairy farmers first.