Blog: Business turns sour for Dairy Farmers of Britain
Dean Best | 3 June 2009
The outlook looks sour for UK dairy co-operative Dairy Farmers of Britain and its 2,000-plus farmer members.
DFB's management held talks this afternoon (3 June) to discuss the co-op's plight – with a possible move into administration likely.
But why has DFB, one of the UK's largest dairy co-ops, fallen on hard times?
In short, DFB's plight is a reflection of the tough trading environment in the dairy sector.
Despite recent moves to cut the price it pays its suppliers, DFB has faced fierce competition in the liquid milk and cheese sectors.
Losing a contract to supply fresh milk to UK retailer The Co-operative Group was a big blow to DFB and the future for the business remains uncertain.
DFB's management has led a strategic review of the business, which led to the company being split into two divisions – milk supply and cheese.
Industry watchers speculated that the revamp would make the company more attractive to potential buyers. Two weeks ago, DFB sold dairy ingredient business Nene Valley Foods.
The whole business could now face a sale – while its thousands of farmer-members could be forced to find new buyers for their milk.
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