The future of dairy farming in Aberdeenshire and Angus has been thrown into jeopardy with the news that the only milk processing site in the region is to close.
Dairy giant Muller has confirmed it will close its factory in Tullos, Aberdeen, with the loss of 87 jobs.
This follows a consultation into the future of the site, and one other in East Kilbride, earlier this year.
Muller said the Aberdeen factory, which processes milk from 43 farmers in the region, will close “as soon as is reasonably practical” and this is expected to be the middle of June.
The company also confirmed its site in East Kilbride will close within the next 18 to 24 months, while its factory at Bellshill in North Lanarkshire undergoes a £15million investment.
Muller’s managing director in the UK, Andrew McInnes, said: “Unfortunately the status quo was not sustainable within our Scottish dairy network, with both Aberdeen and East Kilbride dairies operating well-below capacity. By investing in Bellshill we will be better able to optimise the value in the milk we buy from dairy farmers.”
Dairy farmers supplying the Tullos site have been given two options – continue supplying their milk to Muller but be forced to pay a transport charge of 1.75p a litre to haul the milk to Bellshill, or give 12 months’ notice to quit supplying Muller during which time they will not be charged for haulage costs.
The bulk of producers – 27 out of the 43 – are on standard non-aligned contracts, while 12 are on an aligned contract with Tesco and four are on an aligned contract with the Co-operative. Tesco has pledged to pay any extra haulage costs.
The news of the factory’s close was not welcomed by farmers in the area.
NFU Scotland’s regional chairman for the north-east Roddy Catto, who runs a dairy farm supplying Muller at Hillhead of Muirton, Whitecairns, near Aberdeen said: “I’m incredibly frustrated and disappointed. It’s not good news and it is devastating for every milk producer in the north-east. There’s no question that each individual farmer will now have to look at their own business and make a decision about whether they will continue.”
He said the union was still committed to working alongside Opportunity North East – the new economic development agency for the north-east set up by oil mogul Sir Ian Wood – on a feasibility study to consider the viability of building a new milk processing plant in south Aberdeenshire.
