FrieslandCampina compensates member dairy farmers for less milk

Incentive for reducing the production of phosphates by member dairy farms

17 September 2016

As from 1 October 2016, FrieslandCampina will pay its member dairy farmers 10 euro cents per not produced kilo of milk for a period of six months. This measure comes on top of the recently announced European incentive for reducing the milk production. With this measure FrieslandCampina intends to accelerate the reduction of phosphate production at the member dairy farms in anticipation of the announced Dutch phosphate production rights. Apart from this, the intended reduction will improve the opportunities for milk valorisation.

With this measure FrieslandCampina aims at a reduction of a total of 150 million kilo of milk in the period from 1 October 2016 up to 31 March 2017 inclusive. In this way FrieslandCampina makes a contribution to an accelerated reduction of the phosphate production and so supports sustainable dairy farming. Additionally, this also strengthens the company’s market position.

Practicable and effective

We have opted for an arrangement that is practicable and effective. The financial compensation paid by the company combined with the announced EU measure to reduce the milk production will be an inducement for a group of member dairy farmers to produce less milk.

10 euro cents on top of the European milk reduction premium of 14 euro cents

The company makes available a total amount of 15 million euro for member dairy farmers who produce less milk, which comes down to 10 euro cents for each not supplied kilo of milk. This amount will be paid on top of the milk reduction premium of 14 euro cents paid by the European Union for each kilo of not produced milk to dairy farmers who will have applied for this at before 21 September 12:00 hours. At this moment the dairy sector is talking with the Dutch government about supplementary incentives aimed at reducing the production of phosphates.

Participation in the measure

All members of Zuivelcoöperatie FrieslandCampina can participate, with the exception of organic and biodynamic dairy farmers and on-farm producers of dairy products with exemption. Participation will take place on a voluntary basis. The arrangement will be valid for a period of 1 October 2016 up to 31 March 2017 inclusive. Details with respect to the arrangement will be communicated through melkweb, the extranet of the member dairy farmers of FrieslandCampina.

Today, the Central Meeting of District Councils of Zuivelcoöperatie FrieslandCampina U.A. held a special meeting to discuss this measure.