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The milk price was increased by three cents, but that is not enough for milk producers. Are they not entrepreneurial enough?
Author: Harry Stitzel, Stefan Frühauf
“Milk production must become more attractive,” says Boris Beuret, President of the Association of Swiss Milk Producers at the meeting of delegates. Otherwise, farmers will not be willing to invest in the future.
That also means: He wants a higher one milk price. This is despite the price being at its highest level in 15 years.
Legend: Fight for higher milk prices Boris Beuret, President of the Swiss milk producers SMP, at the delegates’ meeting in Bern SRF
When it comes to milk, emotions run high. After massive protests on the streets, milk producers achieved at the beginning of March that the milk price would be increased by three cents to 82 cents from July 1, 2024. The reason for this was the declining cheese exports, says Beuret. “The situation on the milk market is difficult.”
More prospects for young farmers
The price increase is a step in the right direction, but it is not enough: “In order to maintain the milk supply in Switzerland, we have to cover the costs.” Otherwise milk production will fall, says Boris Beuret.
Production costs have increased disproportionately, and profitability is suffering as a result. The milk producers are therefore demanding a milk price increase of five centimes.
In order to maintain the milk supply in Switzerland, we have to cover the costs.
“The young farmers must be able to invest in new stables and facilities. That’s very difficult at the moment with the current price.” The 47-year-old ETH agronomist Beuret runs an organic dairy farm with his family in Corban in the canton of Jura.
Criticism of the farmers’ entrepreneurial spirit
Farmers need to think more entrepreneurially, says Patrick Dümmler, from the liberal think tank Avenir Suisse. Although there are innovative approaches and many farmers are investing in new stables or milking robots, some do not do enough economic calculations.
Some farmers rely too heavily on the current system and existing subsidies.
According to Dümmler, they did not take costs into account enough, such as service costs for milking robots. “Some farmers rely too heavily on the current system and existing subsidies.”
Caption: Criticism of the farmers Patrick Dümmler, agricultural expert at the liberal think tank Avenir Suisse SRF
The milk price is a benchmark price that the industry is guided by, not an average price. Anyone who generates added value as a farmer can achieve a higher milk price, says Dümmler. For example, by relying on organic products or pasture feeding.
The power of the major distributors
The target prices are criticized. The major distributors Migros and Coop have too much market power and collect most of the margin, farmers complain. “Where the margins remain is a point of contention,” says Dümmler. “The two players obviously know how to use their market power.”
In response to a request from SRF, Migros writes that the latest target price adjustment of three centimes makes milk more expensive for consumers.
This makes it all the more important for the milk producers not to overdo it with protests and demands, said the President of the Milk Producers Boris Beuret: “We have to remain credible, and the demonstrations must not exceed certain limits.”
Complaining at a high level?
Compared to the situation abroad, Swiss farmers are doing well. According to Dümmler, they have a seat at the table when discussing milk prices.
There is hardly any profession in Switzerland that is as strongly represented in parliament as farmers, considering their economic importance. Of course there are some who need support, but also those who would live very well in the current system: “In Switzerland, people sometimes complain at a high level,” says Dümmler.