The results of the fifth DairyCo Farmer Intentions Survey highlight the need for proper contracts to give farmers the confidence to invest in their businesses and stay in dairy farming for the long term, the NFU said today.

NFU Dairy Board chairman Gwyn Jones said higher prices in the latter part of 2007 and at the start of this year had given some encouragement for farmers to invest, but the survey showed general confidence levels were still quite fragile.

"While the survey shows a more positive outlook for British dairy farming than at any time in recent years, the slightest hint of a drop in the milk price would tip that balance in an instant.

"This is where the need for proper contracts is self-evident. Repairing the weak link in the chain to protect farmers from the volatility of commodity markets and provide stability and transparency is crucial if famers are to have the confidence to invest in their businesses and stay in dairying long term.

"With milk in short supply, and buyers falling over themselves to secure their supply base, farmers are in a much stronger negotiating position and must take full advantage of this opportunity to put in place a proper contract."

9:06am Friday 2nd May 2008

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