German Milk Strike Bites as Shortages Begin | Business| Economy and finance news from a German perspective | DW | 30.05.2008
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German Milk Strike Bites as Shortages Begin

A revolt by German dairy farmers gained traction Thursday, with the price for milk rising as farmers all over the country poured milk down drains in a boycott of dairy factories.

Pouring a glass of milk

It's the first time Swiss farmers have joined in a European milk strike

Swiss farmers also started throwing milk down the drains as a strike demanding an increase in the price gained momentum.

In Germany, Romuald Schaber, president of the BDM association of German dairy farmers which launched the strike on Tuesday, said Italian farmers had promised to cut off their supplies to German dairy companies from Friday to step up the campaign for higher farm-gate prices.

He said a similar declaration of solidarity Thursday had come from counterparts in Belgium after the BDM appealed to farmers outside Germany not to fill the shortfall.

The German farmers are demanding a farm-gate price of 0.43 euros ($0.62) a liter for milk.

Farmers blame dairy companies, EU

Uwe Kockerbeck, chief executive of independent milk trader Apollo Milchprodukte said the strikers' target price had been reached already on the spot market since the boycott began. The spot price had risen from 28 cents to more than 40 cents.

"We can't import enough milk to cover the shortfall," he said at his company's office in Kleve near the Dutch border.

Schaber's group, which hopes a successful boycott will make that price rise permanent, claimed the boycott had reduced the supply of milk to German pasteurizing plants and cheese factories by 70 percent. He estimated that 70,000 of Germany's 100,000 dairy farms had joined the boycott.

However Germany's national farmers' union dismissed the claim. A spokeswoman there said only 10 to 20 percent of farmers had joined the BDM's campaign, with most continuing to supply milk. She said she knew of no substantial support abroad for the BDM.

The farmers blamed powerful dairy companies for depressing the farm-gate price of milk, and are also angry at EU plans to increase output quotas. Brussels says it must respond to growing global demand for milk, especially from booming Asian nations.

Before the boycott, the dairy factories of Germany were paying 27 cents a liter in northern Germany and 35 cents a liter in southern Germany for milk, according to BDM data.

First joint Swiss-EU milk strike

In Switzerland, action that started in the German-speaking north and east of the country Tuesday spread to the French-speaking southwest with producers withholding deliveries and buyers reporting the first sign of a squeeze on supplies.

Up to 400 members of the union Uniterre joined a two-day strike starting Thursday and followed the lead taken by several hundred members of its counterpart Big-M in Zurich, Zug and Basel.

Milk fetches around 75 centimes a liter currently with farmers insisting that no longer covers production costs. They say they are being choked by increased costs, namely the rise in the price of fuel.

Big-M is asking for an increase of 10 centimes per liter from July 1 and both unions wish to see milk sold at one franc a liter eventually.

"This is a first that Swiss and European milk producers have mounted a joint campaign to stage a strike," said Jacques Barras of Uniterre, speaking on Swiss television.

He admitted milk would have to be wasted. "I cannot lie and say all the milk will be used. As much as possible will be distributed to the population or taken to farms where it can be used," said Barras.

"There will be milk that will have to be thrown away though."

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