Howie accuses MMC over market place

of Scottish milk producers continues unabated. Following Tuesday's

adjudication by the Monopolies and Mergers Commission against proposals

by the Scottish Milk Board to acquire the Scottish business of the

Co-operative Wholesale Society, claims and counter claims have been

flying fast and loose.

The strongest words came yesterday from the chairman of the SMMB

Andrew Howie, who said: ''It seems to me that the MMC don't understand

the market place. They appear to be viewing the Scottish situation as if

it were contained purely within a domestic ring fence -- nothing could

be further from the truth.

''They just don't understand how the market works, and to accuse us of

being in a position where we are able to manipulate the price of milk is

quite unbelievable.''

Mr Howie, who is clearly staking his stewardship of the SMMB on this

issue, continued: ''The dairy trade will have to rationalise for

survival. If we in the board are not to be allowed to acquire CWS, then

it may well be that a Danish or Irish company will step in. That, in

turn, would put the domestic market at risk, and we could see an influx

of imports. It's a sad state of affairs.''

Meanwhile, the Scottish Dairy Trade Federation have put their point of

view through their chief executive Dr Donald McQueen, who said: ''I hope

Scottish dairy farmers will not see the deliberations of the MMC as a

defeat. We are on the threshold of a new era, and there are tremendous

opportunities in prospect for both dairy farmers and the trade.

''We want to put the industry on a firm footing. The way is clear

following what has already happened in England and Wales, with a clear

separation of their milk board from its commercial operation Dairy

Crest. Shares have been offered to 30,000 dairy farmers, so we find it

hard to understand why this should not happen in Scotland.''

Dr McQueen added: ''The MMC have been totally objective, and it seems

the Government now has to take the initiative -- though we in the trade

are more than willing to meet with the SMMB.''

Whether that invitation will prove acceptable is open to question,

because Dr McQueen added this proviso: ''There is little point in raking

over past issues, because we have consistently indicated a willingness

to talk to the board, provided they come up with realistic proposals.''

The SMMB have obviously anticipated this approach, and Andrew Howie

responded yesterday by saying: ''We are still willing to sit down and

discuss matters with the trade. We are all in the same industry and we

are certain we can give a suitable guarantee that will be acceptable to

everyone.''

Meanwhile, the Scottish National Farmers' Union made their pitch

yesterday through milk convener Alex Brown, who said: ''The MMC seem to

think there is such a thing as a separate Scottish milk market. This

will come as a surprise to anyone involved in the industry. Even with

the present system, milk prices in Scotland are closely linked to those

set in England -- a point the dairy trade in Scotland never tire of

reminding milk producers.

''It is unrealistic to think that milk purchasers will fail to buy

milk from Scottish co-operatives when the statutory powers are removed.

They will source the cheaper supplies just as they do now, whether from

Northern Ireland, England, or the rest of the EC.''

The debate is set to continue on a higher plane, with the Scottish

Office confirming that meetings are to take place between Government

representatives, the SMMB, and the NFU, later this week as to how the

verdict of the MMC will affect the legislation currently before

Parliament to wind-up the milk boards.