FrieslandCampina will encourage member dairy farmers to keep the milk supply temporarily at the same level by paying them an allowance for continuous milk supply. This temporary measure is required because the milk supply by the member dairy farmers is expected to grow faster than foreseen in the coming weeks. As a result of this, the processing capacity of the dairy company will be insufficient as from January until mid-February 2016.
The member dairy farmers of FrieslandCampina delivered about 6.4 percent (600 million kilos) more milk in the year 2015 than they did in 2014. In order to be able to process this milk, FrieslandCampina made heavy investments in extra processing capacity during the last few years. However, the milk supply suddenly accelerated as from November 2015. Due to this, all processing capacity of FrieslandCampina is in use and the possibilities to have the farm milk processed by other dairy companies or to directly sell this to other buyers have been fully made use of as well. If the milk supply will keep increasing this way, FrieslandCampina will have insufficient processing capacity for the period until mid-February. Therefore the Board of the co-operative of FrieslandCampina makes an appeal to the member dairy farmers to adapt their operational management and to participate in this temporary measure.
Payment of 2.00 euro per 100 kilos of supplied milk
For a milk supply that is equal to or lower than the milk production in the reference period between 13 December and 27 December inclusive, the dairy farmer will receive a payment for the supplied milk of 2.00 euro per 100 kilos of milk (excluding VAT).
The period of the temporary measure will come into force on Friday 1 January 2016 and will run until Thursday 11 February 2016 inclusive. This measure does not apply to member dairy farmers delivering organic or biodynamic milk, because there is no capacity shortage for this.