FUW calls for action to support family farms in light of collapsing dairy prices

The Farmers’ Union of Wales (FUW) has expressed concern following a significant fall in dairy prices, warning that the developing situation is placing severe pressure on farm businesses already grappling with regulatory change and wider uncertainty.

Last week, the FUW convened an emergency meeting of its Animal Health & Dairy Committee to assess the scale of the issue. Representatives from across Wales reported widespread anxiety among farmers, with many highlighting a drastic drop in milk prices over the autumn. Processors are now communicating further price reductions into the new year with commodity markets providing little reassurances to indicate stabilising farm gate milk prices through spring. 

Union members have approached the FUW confidentially, in fear of jeopardising their contractual obligations, with serious concern over the projected milk payments for the coming months, given the offers being made that would, in many cases, drop far below the cost of production.

With average milk prices forecast at just 30 to 35 pence per litre, and a previous Kite Consulting report estimating average production costs at 39 to 44 pence per litre, the typical dairy farm in Wales is likely to lose thousands of pounds each month for as long as these troubling trends persist.

Following the Animal Health and Dairy Committee, the Union escalated its concerns directly to the Deputy First Minister, Huw Irranca-Davies MS during a meeting in Cardiff on Wednesday 3rd December 2025, highlighting the immediate threat to family run dairy farms in Wales as a result of plummeting milk prices, with Union officials stressing the need to consider government support and intervention to prevent long-term damage to the Welsh dairy sector.

Gerwyn Williams, Chair of the FUW Animal Health & Dairy Committee, said:

“The speed and severity of this price drop are unprecedented. Farmers are facing an impossible situation where their input costs remain high while the value of their product plummets. Our committee felt it essential to call an emergency meeting because the viability of many family farms is now at serious risk. We need immediate assurances that this crisis is being treated with the urgency it deserves.

“Some can weather a storm for a short period of time, however, rumours that this situation would extend into the summer of 2026 will see businesses shut. These modest sized family farms have invested heavily in infrastructure to comply with regulatory requirements and improve efficiencies, but reductions of this scale will severely impact the ability of these businesses to make their repayments as planned.”

FUW Deputy President, Dai Miles emphasised the wider implications for rural communities:

“Dairy farming underpins thousands of jobs in Wales and plays a vital role in the economic, social, and environmental fabric of our rural areas. When prices fall this sharply, it isn’t just farmers who suffer - local businesses, services, and entire communities feel the impact. We have made it clear to the Deputy First Minister that the government must work with the industry to provide immediate stability and a plan for longer-term resilience.”

The FUW will continue to work with the Welsh Government, processors, and supply-chain partners to seek solutions and ensure that dairy producers receive fair and sustainable prices for their products.