EVEN at today's low prices, supermarkets make enough profit on milk to justify paying farmers more, Westmorland and Lonsdale MP Tim Farron has claimed.

Speaking at a packed debate, held in Westminster Hall last Wednesday, Mr Farron challenged the notion that 'supermarkets make a loss on milk'.

He claimed the grocery giants made a profit of up to 50 per cent on each litre of milk 'so they can afford to pay fairer prices to farmers'.

Mr Farron also used his speech to call for a series of policy measures that he felt could help dairy farmers and rural communities:

• Giving the Grocery Code Adjudicator the power to look at indirect relationships, and monopoly power of processors as well as supermarkets;

• Putting the Dairy Code of Practice on a statutory footing; and

• Ensuring 'fair trade for UK farmers' alongside fair trade for farmers from overseas

Mr Farron asserted that supermarkets were acting against their own interests by putting dairy farms out of business.

“We have a lopsided, counterproductive, unfair, un-free market that hurts farmers and producers," said Mr Farron. "We must do more to help them. Farmers are not asking for special treatment, they are asking for a level playing field. I hope that we build on last week’s announcement about the Groceries Code Adjudicator being able to fine supermarkets but we must do more. We need fair trade for farmers – be they from Columbia or Cumbria.”

Speaking in the same debate, Lancaster and Fleetwood MP Eric Ollerenshaw called for a Government 'dairy policy'.

He described dairy farming as 'a major British industry', which produced around £4.5 billion worth of products, adding: “What we want to see from the Minister is all of these bits and piece pulled together to form a policy to save what is a vital part of British agriculture.”

Mr Ollerenshaw paid tribute to the supermarket chain Booths which claims to pay the highest price to milk producers at 34.5p per litre.