IAN POTTER ASSOCIATES
24th April 2007
Specialist Agricultural Quota & Entitlement Brokers
Telephone 01335 324594 Fax 01335 324584 Ceefax BBC2 Page 249
Website www.ipaquotas.co.uk Email sales@ipaquotas.co.uk
815,760 3.87% 0.59ppk 2.3ppl
720,415 4.03% 0.62ppk 2.5ppl
Today
2.30ppl
Clean
0.25ppl
Lease
Last Week
2.00ppl
0.30ppl
Change
+0.30pp l
-0.05ppl
200,000 3.94% 0.06ppk 0.25ppl
500,000 4.23% 0.03ppk 0.30ppl
4 Weeks Ago
Same Week 2006
1.50ppl
4.00ppl
0.10ppl
0.40ppl
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ALTERNATIVELY BY FAX. TO RECEIVE A COPY PLEASE LEAVE YOUR DETAILS ON THE COMPETITION CARD PROVIDED OR EMAIL /FAX
YOUR DETAILS TO OUR OFFICE.
Dick Turpin fired as the Danish Invasion continues In our 16th March bulletin headline “Arla changes in the wind” we suggested
significant changes were imminent post the Danish invasion and realising how urgent the surgery was the Danes have cut once, cut
deep and quickly. Tim Smith of Arla was told on Thursday by the Danes to clear his desk of his personal belongings and was
“promptly escorted out of the Leeds building!” He will be immediately and permanently replaced by a Danish man, Peter Lauritzen,
and this can only be considered good news for the partnership and its members.
When his predecessor, Neil “Knuckles” Davidson, (as DIN called him) left Arla many farmers expected relationships between the
processor and its supplying farmers would improve. Frankly they didn’t and as one industry leader commented “Smith was just
another wolf in the same sheep’s clothing”. So Dick Turpin leaves with a reported settlement package of around £2m but that could
be a small price to pay if the Dane seizes the opportunity to work with retailers and Arla producers fairly. Tim Smiths firing squad also
added finance director Nigel Peet and company secretary John Price to their departure lounge. At least two others breathed a huge
sigh of relief when the execution squad left having had a lucky escape, for now.
Will the new Arla boss be another Peter the Great?Peter the Great transformed Russia from an isolated agricultural country into
an Empire ranking alongside Europe and once dived into the sea to rescue some drowning men. So will the new boss of Arla turn the
UK arm of the business into the undisputed leaders in UK processing particularly in terms of communication and PR and save it s
drowning farmers? One of his first jobs will be to mediate on the bitter battle between Peter Walker, who has only 2 months to go
before he retires and Jonathan Ovens and his partnership board over Arlas refusal to hand over the 0.7ppl promised (see story
below). If he is persuaded to find in favour of the partnership he will win instant credibility. Things are sure to change at Arla and some
of the staff in the Leeds office will quickly realise they have to change their attitude if they intend to work for a co-op and not a plc.
Friday 13th unlucky for Arla Producers The letter sent on Friday 13th by Peter Walker of Arla has caused a bitter reaction from
producers by its failure to mention the 0.7ppl due to be returned to producers as a result of the ending of the milk balancing scheme
on 31st March 2007. So why has Peter Walker ignored the 0.7ppl? Why did a letter confirming a milk price increase come from Peter
Walker and not from Jonathan Ovens and the Partnership board? We are informed that Mr Ovens and his team were not aware of
the letter or its contents until it was too late to stop it. Also that the Partnership Board have not agreed to Arla keeping any of the
0.7ppl balancing money due to be returned to producers. The 0.7ppl was to be given back to facilitate the new balancing scheme,
which producers have to pay for from 1st April.
There is no doubt the 0.7ppl was to be returned to producers. It has been referred to in two Partnership letters, a presentation to
Partnership District Chairman at the Stoneleigh Dairy Event and indeed at the AGM with Smith & Walker present on the top table. No
doubt Arla Partnership meetings this week will have the missing 0.7ppl at the top of their agenda and we can only hope Partnership
lawyers, Burges Salmon, are let off the leash to bite Arla on behalf of producers. Meanwhile, Peter Walker is currently denying any
agreement over the 0.7ppl re-instatement, cue reaching for notes of meetings and deleted e-mails. During the week this denial has
softened to ongoing negotiations and Ovens and his team are making positive progress with their case for the money.
Wake up Arla producers you have just had an imposed price cut not a 1ppl rise Our 13th April new bulletin of Modern Day Robin
Hoods without masks applies to the latest robbery by the deadly duo of Tim Smith and Peter Walker of Arla the latter having been
more accurately named a modern day Dick Turpin without a mask with another producer calling him Robin Ba_t_rd. The Friday 13 th
letter (see above) is all very positive trumpeting a 1ppl rise but “if” Arla is stooping so low as not to re-instate the agreed 0.7ppl the
1ppl rise is actually a 0.3ppl rise. And even that figure is not accurate because Arla producers now have to pay their own balancing
charges, which is the very reason the 0.7ppl has to be re-instated and this will erode the 0.3ppl and more. In fact, the increase
reduces to 0.1ppl for those who received the 0.2ppl level supply bonus. It doesn’t look so rosy now does it? So Arla producers have
just received a price cut and ALL 1600 of them should be furious and banging on the Leeds doors and not swallowing the medicine.
The question is will the new Danish boss allow Smith & Walker’s alley cat morals to continue?
Why have Morrisons and Tesco allowed Arla to cheat producers With ASDA’s price increase having gone to its dedicated
producers, the reality is, in the case of Morrisons, they have paid 1.3ppl to both Arla and Dairy Crest and Arla have used the money to
avoid paying over the 0.7ppl. The Arla figures just do not add up and it’s time both Morrisons and Tesco stepped forward to stop the
theft of their consumers money. It’s not The Great Milk Debate, it’s The Great Milk Robbery.
Disappointing price increase for Dairy Crest non Sainsbury’s group suppliers The word on the street is that having stripped
out the Sainsbury’s 1.3ppl increase to go only to these farmers as well as M&S and Waitrose prices, other DCD liquid suppliers had
better be braced to receive a miniscule increase of around 0.2ppl.
Milk for cheese price increase of 0.5ppl from Helers From 1st May, Helers have increased their milk price.
Dairy Industry News conference could have a problem Barry Wilson’s conference (see diary below) had Tim Smith down as a
speaker to discuss his business strategy and the impact of the full takeover of the business by Arla Amba. If Smith intends to turn up,
which we very much doubt, this could be a fascinating paper with Smith certainly having personally witnessed the impact of the
takeover in less than 2 weeks.
Ian’s Diary
24th April – Carr’s Billington Agriculture, Lansil Mill, Lancs. – 2 Presentations 1 lunchtime & 1evening.
25th & 26th April – DIN Conference London “Growth in a mature market” …if there’s enough milk.
All views expressed in this bulletin are those of Ian Potter Associates and a shed load of Arla suppliers. It is necessarily short and cannot deal with the
various issues that arise in any detail. As a result it must not be relied on as giving sufficient advice in any specific case. Every effort has been made to
ensure the accuracy of the content but neither Ian Potter Associates nor Ian Potter personally can accept liability for any errors or omissions. Professional
advice must always be taken before any decision is reached