A decision on future dairy processing activity in the north-east is likely to be made next month.
This follows the second stage of a study by north-east economic development agency ONE and Aberdeenshire Council into market options for north-east dairying.
The first stage of the study revealed that the majority of dairy farmers in the region were committed to the sector and a number of processing businesses were interested in investing in the region.
The study was commissioned following dairy giant Muller’s decision to close the region’s only milk processing plant earlier this year.
The factory closure has resulted in the bulk of the 43 dairy farmers, who were previously supplying the Aberdeen plant, having to pay a transport levy of 1.75p a litre to have their milk hauled south for processing.
ONE director of food, drink and agriculture, Peter Cook, said although a number of farmers had chosen to exit the industry since the factory closed, the bulk were committed to a future in dairying.
Speaking at a meeting of the regional agricultural advisory group Nesaag, which comprises councillors from Aberdeenshire, Aberdeen City, Angus and Moray, Mr Cook said although milk prices had improved in recent months, there were questions over the viability of producing milk in the region without a processing facility in place.
“Some folk have already gone out of the industry so there is a fear we are going to lose the whole dairy sector,” said Mr Cook.
He said initial findings suggested it would be very difficult to establish a new consumer product, however there were opportunities elsewhere in ingredients supply.
When asked if the establishment of a new processing plant would present opportunities for farmers to get into dairying, Mr Cook said if new contracts were up for grabs there would definitely be opportunities to get into the sector.
Earlier this year the Press and Journal launched a campaign to safeguard the future of north-east dairy farming.
The Local Milk is Miles Better campaign sets out to drum up demand for local milk and help build the business case for a new milk processing factory to be built in the region.
At the moment all milk stocked in north-east supermarkets has travelled at least 100 miles before it reaches the shop shelves. It is not possible to buy milk which has been produced, processed and bottled in the region.
You can pledge your support by signing our online petition here.