Spanish Dairy Sector on Brink of Collapse

The Small Farmers Union (UPA) has described the rising costs as illogical and absurd. It explain that demand for products is increasing, and with costs continuing to rise producers should see price increases.

However this is not the case. Since 2009 the average price of feed concentrate for dairy cattle has increased by more than 17 per cent, and an further 10 per cent increase is expected this month as drought takes its toll.

Over this time, diesel prices have also risen 40 per cent, whilst electricity and medication has also increased.

The UPA says the price of milk has not risen to the same extent as production costs, which has meant many farmers are making huge losses.

Roman Santalla, Livestock Secretary of the UPA said the drought is making a bad situation worse. "A lack of pasture and forage has meant that producers must purchase more feed for cattle. Straw and alfalfa prices have increased 40 per cent, due to pressure from imports from Arab countries.

The UPA estimates that Spanish livestock producers have lost more than one million Euros since the drought last summer.

In recent months, milk prices have fallen, said UPA, and it is likely that this trend will continue. The UPA is calling on milk purchasers to behave responsibly and pay a fair price for milk.

Protests are being organised this month with regard to a lack of aid to protect against drought. They will initially take place in Santiago de Compostela, but the Union hopes they will be extended into other area.