As the crisis at collapsed dairy co-operative Dairy Farmers of Britain (DFB) reached its peak, Northumberland-based industry expert Bruce Jobson offers his perspective on what went wrong.

THE catastrophic collapse of Dairy Farmers of Britain (DFB) for £100m may appear as another casualty of the global marketplace but the demise of the company has been imminent for a considerable period of time.

The human tragedy is the potential loss of an estimated 2,200 jobs at the company’s three plants including Blaydon, where 600 people are employed. It’s easy to talk in terms of statistics but the emotions and insecurities of these individuals and their families remains a heart-breaking concern.

When DFB invited PricewaterhouseCoopers (PwC) as receivers on June 3, 1,800 farmer suppliers were dealt a severe financial body-blow. The average figure estimated for an individual financial loss was quoted as £14,000 for milk supplied during the month of May and first few days of June. Of course, this was an “average” figure and some larger suppliers would lose more and other smaller producers, much less.

However, the figure represented the lowest common industry denominator, but when multiplied, the loss to farmer suppliers on a national-basis is £25,200,000. Spin-doctoring of statistics definitely springs to mind.

Furthermore, farmer members who invested in the co-operative have also lost an estimated £25,000 pushing individual losses to the £40,000 level. The final shakeout is likely to be a loss in the region of £150m and a full breakdown of the implications of the collapse will be provided by PwC on September 7.

The cynical way that farmer suppliers have been treated by DFB has caused immense outrage. It is hard to believe that farmer-directors of the company were not aware of the threat to producers.