A SOUTH-West dairy farmer is in dispute with First Milk over his bid to leave the co-op and move to another buyer – he claims the dairy co-op is threatening him with legal action unless he sees out his 12 month contract.

Matthew Caughie, who produces 700,000 litres at his Kirkbride Farm, Port Logan, south of Stranraer, told The Scottish Farmer: “I am only a small producer, but with a wife and four young boys, my returns from First Milk of just under 20p a litre are making it extremely difficult – almost impossible – to support my family.

“I have signed up to switch my production to Lactails where I will be 4p a litre better off, but First Milk tell me I can’t go until I’ve seen out my contract which I cannot afford to do.

“I phoned up First Milk’s headquarters telling them I was stopping production and was told that was not a problem. All they wanted to know was when I wanted my collection stopped.

“But when I indicated I was switching to Lactalis, their attitude totally changed. Co-op chairman Bill Mustoe telephoned me and tried to talk me out of moving. When I refused I was sent a threatening letter. I’m now expecting a court writ any day now.

“I will not give in. I know of many other First Milk producers who are in a similar position to me, unable to earn a living from what they are paying me.

“First Milk appear willing to see me go bust. The fact the co-op had a fall-out with Lactalis obviously has a bearing on the way I’m being treated.

“You can’t freely trade your milk on a year’s contract and I think it is time that First Milk considered changing its contract conditions as they are too severe on small producers like myself.

“Those in charge at First Milk have done little to get their producers a fair return from the market. The co-op has too many people getting paid too much money at our expense,” said Mr Caughie.

“For the sake of my family I have to move and move quickly. I have told First Milk verbally I’m leaving at the end of this month. I’ve no interntion of staying a day longer.

“They’ll get a phone call from me telling them not to collect my milk. With my lawyer, we’ve prepared my case for court. I’ve support from other producers and MSPs. I warned First Milk on Tuesday that they should take the easy way out and let me go.”

First Milk could be treading dangerous ground if they do take Mr Caughie to court. Contract disputes are not new. Both Arla and the now defunct Dairy Farmers of Britain have taken farmers to court over what they believed were clear breaches of contract and in each case the processors lost and costs in excess of £200,000 were awarded against them.

First Milk’s communications director Paul Flanagan said: “We have a producer who wants out of his contract. To date he has not put in his notice, despite him telling us he wants to leave immediately. We need producers to stick to their contracts to allow us to meet the contracts we’ve agreed with our customers.No writ has been served.The ball is in his court.”