To make the increasing number of milk flows more transparent and comparable, LTO Dairy Farming and ZuivelNL will accurately map the additional yields and the specific requirements once a year.
A new inventory shows that Jumbo's own brand milk currently costs €0,81 per liter in supermarkets, while FrieslandCampina's organic milk is €1,30 per liter. It is a difference of almost €0,60 per litre. In between, an increasing number of milk flows develop. The most recent example is dairy with the 'Beter Leven' quality mark. In 2018 FrieslandCampina successfully launched the Top-Zuivellijn, of which 'On the way to PlanetProof' is a part. VLOG milk is also developing rapidly.
A lot of differences
Not every buyer offers the same milk flows and most new milk flows have a large quantity and often different requirements. Switching involves costs and investments. What will this bring me and what suits my company best? These are considerations in which the dairy farmer has to make a choice.
The department is in favor of the increasing number of milk flows with which dairy farmers can increase the margin per litre. It provides a better experience for the consumer, so that he makes a conscious choice and understands that this involves an additional cost. The often-heard objection that the increasing number of milk flows increases the logistics cost, so that segmentation costs more money than it generates, according to LTO Nederland, is unfounded.
Payback period
However, the department also sees risks, of course. There is, for example, the risk that requirements set for these specific milk flows will also be rolled out sector-wide. To date, however, it has not been shown that politicians are taking advantage of an accelerated increase in the basic requirements across the sector. "On the contrary even", according to department chair Wil Meulenbroeks and portfolio holder Jos Verstraten. "The development of the logo for meadow milk has actually ensured that the percentage of meadow grazing has increased, without government measures."
The department wants to be as clear as possible about the payback time of the investments. The LTO Dairy cattle also wonders what will happen if a new milk flow does not yield a return. Are the risks then for the dairy farmer and what options are available to sell the milk if a milk flow ceases to exist? What contract conditions and guarantees are made and offered? These are questions to which it wants an answer.
Don't force a choice
At the same time, the department indicates that doing nothing will most likely result in a below-average milk price. However, the cost price remains lower, because no investments have to be made. The department does not want to impose a choice on member dairy farmers, but provide more insight in order to make their own assessment aware.
© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.
