BRITISH DAIRY SUSTAINABILITY – A PLAN FOR THE
FUTURE
Louise Welsh – Agriculture Manager, Morrisons
Wales DairyCo, Stradey Park, Llanelli
What I’ll be talking about today
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Morrisons – why we’re different
A look at our milk and cheese business
The Morrisons Farming Programme
Morrisons and First Milk – Fresh thinking for British
Cheese Production
“More of what matters”
Morrisons – why we’re different
• UK’s 4th largest multiple retailer
• UK’s largest food manufacturer
• We buy over £1bn worth of food from British farmers
annually – meat, fruit and veg direct from producer
• Vertical integration - only multiple retailer to own
abattoirs and packing houses
• British Milk – we buy 375 million litres annually
• We farm ourselves – Morrisons Farm, Dumfries House
“More of what matters”
Morrisons – why we’re different
“more of what matters”
Morrisons – Liquid Milk Marketplace
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Shoppers continue to shop around for their milk
All Grocery Multiples’ sales of fresh up 1.5% YoY
Standard fresh now seeing volume growth 1.7% YoY
Morrisons have fought hard to retain share – last 4
weeks standard fresh1.8% up YoY
• Customer insight reveals our growth achieved through
existing customers increasing volume
• Cut price deals continue to attract shoppers into
discounters
“More of what matters”
Morrisons – Vision for Dairy
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To be the No1 dairy products retailer in the UK
Drive loyalty
Sell one more
Make it easy and pleasurable to shop
Educate – health and usage
‘Futureproof’ dairy
“More of what matters”
Morrisons – Drivers and Enablers
Drivers
• Look and feel in store – engagement and space
• Usage and versatility – ideas and education
• Positive health – dispel myths, highlight the positives
Enablers
• Formats – supermarkets, convenience, online
• Marketing & promotions – to include loyalty driving
• CSR
“More of what matters”
Morrisons engagement with Dairy Suppliers
Milk
• Long term contracts with Arla and Dairy Crest
• Source milk from circa 400 GB farms in non aligned pool
• Responded to input cost rise and weather hardship with
6ppl payment in July 2012
• Worked with processors on development of new, fairer
pricing models
• Worked with farmers to better manage input volatility
• Support principle of VCOP
“More of what matters”
Morrisons engagement with Dairy Suppliers
Cheese
• Contract with First Milk to
supply all Morrisons’ block
cheese
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Branded cheese listings are:
Seriously Strong
Cathedral City
and Pilgrims Choice
“More of what matters”
Morrisons Farming Programme
AFFORDABLE
Customer
PROFITABLE & SUSTAINABLE
Retail
Manufacturing
Farming
• £££ investment to help build sustainable farm businesses
• Securing supply of affordable food for customers
MFP Projects – Some examples
“More of what matters”
Morrisons’ cheese requirements
• 11.5 million people shop for cheese in our stores every
week
• Our Farmers Boy manufacturing business needs a
supply of consistent quality block cheese for processing
• We need a secure and competitive supply chain
• Customers must see British cheese as value for
money….or may look for cheaper imports
“more of what matters”
Morrisons & First Milk – from farm to store
Milk Production
FM Processing
Farmers Boy
UK Block Cheese
Morrisons
“more of what matters”
Morrisons and First Milk – fresh thinking for British
cheese
• Vision = a more sustainable supply chain based on
forage based farming system
• Efficient conversion of grass to milk
• Welsh farm trials reveal dairy farms producing
significantly more milk from forage than national average
76% compared to 30% and generating healthy margins
• Morrisons/First Milk sustainability working group
• One year trial,15 farmers in Pembrokeshire area to test
and benchmark more forage systems
“More of what matters”
Morrisons and First Milk – fresh thinking for British
cheese
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Soil sampling
On farm advice
On farm workshops
Bring in the experts
Study trips to exemplar grassland farmers
Successful model for dairy farming
Building block for economically and environmentally
sustainable dairy businesses
“more of what matters”