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'Families subsidise milk by 4p a litre'.

Farming families are subsidising the price of a supermarket pinta by nearly 4p a litre. Now dairy farmers are being urged to include the value of family labour in their farm accounts to bring the true figures into the open. Farmers have traditionally underestimated or discounted the cost of work done by family members, but the Royal Association of British Dairy Farmers says it is time to include reliable costs in order to calculate and standardise the true cost of milk production.

The plea follows a detailed study by the association concluding that family labour adds 3.81p per litre to production costs.

Five-hundred dairy farmers, with an average herd size of 156 cows and yield of 7,112 litres, were included in the survey.

The herds are essentially family run by an average of 3.62 people. The farmer worked 57 hours per week, and 64% of spouses and 42% of sons or daughters were involved.

The responses were analysed by an independent human resource specialist to benchmark dairy farmer skills and responsibilities against jobs in other industries.

RABDF determined from the study that the average cost of family labour to run a technically efficient, average size dairy enterprise amounted to pounds 42,241, the equivalent to pounds 271 per cow or 3.81p per litre.

On a 150 to 200-cow unit, family contributions added to hired labour pushed up the total labour cost to between 5.5p and 6.0p per litre.

'We had been concerned in the past about statements saying producers could make a profit and have sufficient cash to re-invest at a milk price as low as 16p per litre,' said RABDF chairman, Tim Brigstocke.

'We investigated those figures and found that the crucial value of labour had not been recorded in the accounting process, therefore farmers themselves were subsidising the real cost of production.'

The news helps to explain the current exodus of farmers out of milk production, as increasing numbers come to realise the scant rewards they receive for work that demands their attention every single day of the year.
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Publication:Western Mail (Cardiff, Wales)
Date:Feb 1, 2005
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