On Why it is more profitable to spill milk than to drink milk, or not?

Last Thursday I attended a conference in the Biotechnology department of the University of Ghent on fair milk. When hearing about ‘fair milk’, intuitively I would think about some sort of milk that would be imported from a developing country like Senegal or Burkina Faso. Indeed, milk sold at a fair price, while supporting community development of local farmers. In fact, Belgian and other European farmers also face severe problems of obtaining a fair price. Following a series of protests of milk farmers to scrutinise the dumping prices of the milk; the sector launched the idea of marketing ‘fair milk’. This milk would provide the farmer with a fixed price that would cover its production costs while also assuring him a decent wage to sustain his living. However, the FAIRTRADE Mark is a registered certification label for products sourced from producers in developing countries. Hence, the labeling organisation opposed to the idea that Belgian farmers would adopt the name. The use of the mark fairtrade by heterogenous actors would dillute the brand, would create confusion on the standards, principles and strategy behind the use of the name ‘Fair Trade’.

The birth of ‘fairtrade milk’

In September 2009 the public could watch staggering images of farmers spilling 3 million liters of edible milk on fields in protest of low milk prices. More than 2000 farmers from Belgium, the Netherlands, Luxembourg and Germany gathered on this protest action, and similar actions were also undertaken in other European countries. In the Netherlands angry farmers spilled 140.000 liters on the field. Protesters demanded sweeping reforms of politicians in order to tackle the historically low price of 20 eurocent, while  40 eurocent would be the minimum for a decent living.

Fair milk: a fair price for the farmer

In the debate, Sieta Vankeimpema, vice-president of the European Milk Board explained that the payment dairy farmers receive for their milk has steadily fallen since 2001. At the same time, production costs (i.e. fodder costs, rent) have risen dramatically. Tens of thousands of farmers have stopped dairy farming – with dire consequences for many regions in Europe. To counteract this trend, dairy farmer prices must cover costs. It is with this aim that dairy farmers in many countries across Europe have joined forces in the European Milk Board and have set up ‘Fair milk’. Sieta concluded that the fair milk ensures the farmers of a fixed and fair price for their milk (40 eurocent).

Mikka: we can do it ourselves!

Koen Van de Walle of Mikka is a small scale dairy farmer. Over the years he was confronted with the buying power of the milk traders (melkerijen), that offered the spot prices in the market. As discussed above, this price is not sufficient to sustain a decent living as it hardly covers the distribtution costs. In addition, farmers like Koen are becoming alienated from their end-product and consumers alike in this impersonal system. Their end-product would be treated under Ultra-High-Temperature Processing, eliminating a large part of the nutrients and flavours of the milk. And the product would be sold in an anonymous standarised mass marketing package, with no connection to the farmer that milked the cow. So Koen and some of colleagues sat together and developed an alternative. In order to control the price they would cut the unnessecary chains of the distribution channels. Quid with the milk trader, quid with the large scale retailers, enter their own distribution channel through small groceries, enter milk that would preserve the rich aromas of fresh milk,  and Délimel was born. Through their own label they can now ensure a fixed price of 0,40 Euro for one liter of their milk.  However, no clear environmental standards are set by these producers.

Biological milk

A rather innovative price fixing system has been developed by biosona, in addition to this the milk is produced under more ecological sustainable conditions. The price the farmers receive for his/her milk is based on a production calculation model, that is adjusted twice a year in order to correct for market changes. Once a year the price is also checked with the accounting of one represenative farmer. This in order to ensure a living wage of 40,000 gross for the farmer. The model is based on a farm of 50 hectare that would need 1.5 Full Time Working force. At this stage the price the selling farmer receives for one liter milk. In addition the farmer has to take into account ecological considerations. The protein rich fodder should be sourced locally. This is imported soy can not be added to the feed of the cows. The intensive soya plantation in South America often cause severe environmental degradation and have serious social impacts. Farmers selling their milk for the biosona label should also commit to decrease the use of antibiotics. This innovative model for Belgium had been developed in the frame of ‘Bio zoekt keten’ (Organic looks for marketing chain). ‘Bio zoekt keten’ was initiated in order to develop the marketing chain (supply-retail) in Flanders. It was noted that the supply is often dispersed and could not reach the increasing demand. Consequently the project is offering cooperation, integration of regular retailers and balance supply and demand. The organic milk biosona has drawn on the expertise of the founding organisations, the social and ecological  rules have been developed by Vredeseilanden.

Debate with Guy Depraetere (ABS), Sieta Vankeimpema (EBM), Koen Van de Walle (MIKKA), LiLy Deforce (Max Havelaar) en Mieke Vercaeren (Colruyt)- excused. Moderator is MO*journalist John Vandaele.
.Organisation: Wervel vzw en MO*.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s