Future milk powder exports may benefit dairy farmers

Government is planning talks with the European Investment Bank to find ways of funding increased milk powder processing, Farming Minister George Eustice said.

In the coming weeks George Eustice will meet representatives of the European Investment Bank (EIB) to understand how the UK can access funds to bolster processing capacity, a hearing of the Commons’ Environment, Food and Rural Affairs Select Committee heard.

The Minister was questioned by MPs on low farm gate prices and how the situation could be eased - including the long-suffering dairy sector.

Committee chairman, Neil Parish MP asked Mr Eustice if the UK was ready to take advantage of “mood in the market” that the China may seek sources of more baby milk powder after ending its one-child policy.

The Minister replied: “Yes, and I know that Dairy Crest... have been doing some work to make use of the whey by-product they get from making cheese to develop it for formula milk specifically for export to China.”

And, he added: “We have been doing some work with the EIB with the potential for using RDP (Rural Development Programme) funds to support increased processing capacity.”

Any funding is likely to be targeted in Cumbria initially, he said, partly due to the volume of milk produced by farmers there that goes into skimmed milk powder.

Tim Mordan, deputy director of farming productivity at the Department for Environment, Food and Rural Affairs, said the Government was well-placed on trying to open up exports to China it now has a food and farming ambassador operating there.