How has Coronavirus impacted the Dairy Industry?

All around the UK, industries have been feeling the effect of lockdowns, stay-at-home orders, and business shutdowns. With the advent of Lockdown 2.0, it is important to see how this has affected the UK’s largest farming sector. The dairy industry of the UK is responsible for thousands of jobs and millions of animals. With over 13,000 dairy farms in the UK, it’s safe to say that many people will feel the impact.

The impact on the dairy industry

After the hospitality industry closed in the first lockdown, price for milk dropped radically.
After the hospitality industry closed in the first lockdown, price for milk dropped radically.

Before the first lockdown started, around 8% of all liquid milk produced in the UK went into the hospitality sector. As a result, when everything closed down in March, there was an enormous surplus of milk. This had knock-on effects throughout the supply chain as prices dropped dramatically. Gallons of milk were poured down the drain as there was no one to buy it. By April, the AHDB found that over 55% of dairy farmers had been subjected to price reductions and milk cancellations. On top of that, almost a quarter had been asked to reduce their milk supply.

The farmgate price for milk fell after the first lockdown. But now, it has increased steadily since June as the industry has adapted to cope with the situation. Producers have shown their resilience and initiative through on-farm vending machines. These milk dispensing machines help keep farms in business and capitalise on the ‘Stay Local’ message from the government. Temporary relaxation of competition laws has led to collaboration across the dairy industry to help everyone manage through these crazy times. Farmers and producers have managed surplus milk and shared resources and facilities. Production capacity has been increased along the supply chain, and, thankfully, excessive waste has been avoided.

Has there been any help from the government?

The government has created emergency fund schemes to provide £10,000 to each farmer who has found themselves adversely affected by the virus. They have also urged business owners to take advantage of the Coronavirus Business Interruption Loan Scheme. On top of that, they have also backed a £1 million campaign which hopes to boost milk consumption and reduce the additional stock many have accrued.

The National Farmers Union and DEFRA worked together to make sure that farmers are treated as the essential workers they are, and to support those struggling throughout the epidemic. You can find support and resources on their website, here. Similarly, the AHDB have maintained their monitoring of the industry and have also set up a Coronavirus Helpdesk. This provides additional information and resources specifically regarding COVID-19.

While we are not sure when or how this might end, we can take heart from the support and collaboration shown between individuals and communities. With a vaccine for COVID-19 on the horizon, hopefully the dairy industry will be able to weather this storm and come out stronger for it.