Increasing capability and innovation in the dairy space

Digital Dairy Chain’s Programme Director, Stuart Martin, explains why UK Research & Innovation’s injection of £21million is vital to secure the sector’s future growth

STUART MARTIN , PROGRAMME DIRECTOR | DIGITAL DAIRY CHAIN

Last year trade experts at the Institute of Export & International Trade welcomed Chancellor Jeremy Hunt’s plan to lift UK growth by focusing on enterprise and education. He identified that the golden thread running through the industries where Britain does best is innovation.

Whilst innovation has been a dynamic part of new product development for dairy manufacturers to add value in a highly competitive and consumer trend-driven market, financial constraints have often limited technological agility and process developments in parts of the UK dairy supply chain.

The UK needs to match comparable high-income countries in its adoption of effective agricultural technologies and recent trends would indicate attitudes are changing. The rising number of robotic milking system installations is a clear example where innovation has been used to solve a problem.

Emerging technologies provide farmers with data-driven insights, allowing them to improve and streamline farm management at all levels, increasing productivity and, importantly, sustainability.

With national milk processing companies attaching an increasing number of sustainability KPIs to milk contracts and a strong consumer interest in the environmental impact of dairy farming, there is no doubt technology is needed. Industry-led research and development is a key driver of economic growth as it spurs innovation, invention, and progress.

This steadily increasing uptake in innovation and R&D by the dairy sector is demand-led by the consumer and government legislation. It is also driven at farm gate level as farmers strive for excellence to satisfy supply chain demands and to help keep the business profitable to ensure a future legacy.

Innovation is very much part of the backbone of the Digital Dairy Chain’s objectives. One of the biggest challenges is putting theory into practice but we’ve done just that.

In conjunction with Innovate UK, Digital Dairy Chain hasrecently funded seven groundbreaking R&D projects that will significantly advance long-standing processes in the dairy supply chain.

The individual projects have each received grants of between £200-350K which will be invested in work taking place predominantly across Cumbria and South and West Scotland. The projects, all within our geographical reach, had to be collaborative, and business-led; as well as showing a realistic potential to support business growth, scale-up and job creation for the sector.

The focus on Cumbria and South and West Scotland was due to their rich natural capital yet low business spend on R&D and the negative prosperity gap reported by local authorities.

Approximately a 13% share of the UK’s dairy herd are located within this area; it is the UK’s second largest milk producer, supplying approximately 1.9bn litres of milk with an estimated farm-gate value of £550m.

The area is also home to 52 dairy processing businesses ranging from large multi-nationals to small artisan producers, adding value to milk from 1,300 farms. The dairy manufacturing sector is a vitally important source of economic activity for the area, but kickstarting innovation still required cash and the ability to facilitate industry collaboration.

The seven winning projects faced some strong competition, and the calibre of applications was very impressive. Proof again the appetite for R&D in the dairy sector is high but innovation requires investment in terms of both time and money. It’s the classic chicken and egg scenario for regions such as Cumbria and South and West Scotland.

Business growth opportunities arise from new technologies; new markets; import substitution; and consumer demands around food quality, environmental impact, and animal welfare.

These, together with government initiatives to increase innovation, improve skills, minimise waste, and move towards a net-zero economy are collectively significant. Projects, such as the Digital Dairy Chain, show that where there is funding, support, and expertise, they are being wholeheartedly embraced by the dairy industry and transformative innovation will be the outcome.