The agricultural manager of Morrisons, Andrew Loftus, has said that his stores were seeing a drop in profit, and therefore could not be profiteering from the huge drops in the price of milk.
The price that dairy farmers are being paid for milk, is, they are arguing, lower than the cost it takes to produce it.
You can now get two litres of milk for £1 in many supermarkets.
While this is great news for customers, who will see the biggest effects of price drops on staple goods, like milk, the damage is being felt down the line.
Dairy in this country used to be a big industry, but over the last decade it has been massively reduced due to many factors like importing. Many farmers have been pushed out of the industry, and the classic milkman figure has been banished from the early morning streets.
Last month, an urgent inquiry was launched into the price of production and sale value of milk in Scotland, to see if big companies are to blame, and what can be done about it.
Mr Loftus, when questioned, said: “I can categorically assure this committee [Morrisons profit margins on milk] are slightly under the average gross margins for Morrisons retail as a group.”
Several supermarkets have placed the blame on the supplier Arla Foods UK, who provides both Asda and Morrisons with milk. Asda’s sustainable business director, Chris Brown, said: “I would like to emphasise that that’s the price that Arla pay and Arla decide.”
If nothing changes, then the milk industry in the country could be gone for good, and then we would be relying on imports which potentially could see huge, long-term price rises.
