My colleague Ian Ashbridge forwarded me the Kite Consulting report on the outlook for the dairy market earlier this week with the comment "you like dairy reports, Phil" and the suggestion I might like to blog on it.
He was right! In recent months I have reported and blogged on a succession of industry reports, including those from DairyCo, Dairy UK and the NFU. And I have to admit I find them fascinating, even though they have a tendency to be somewhat gloomy.
This latest report from Kite Consulting is equally interesting - and what's better, it has a more positive spin.
OK, it does not belittle the dire warnings that have emerged from the NFU and DairyCo - the suggestion that the British dairy industry is at a "tipping point" and the prediction that over half the UK's dairy demand will soon be met by imports.
But it does take a much more upbeat look at what the future might have in store for those who weather the current storm.
In particular, it suggests that dairy markets are now at the bottom of the price cycle and will start to pick up in 2010 as global demand outstrips supply and stocks of dairy commodities shrink.
With a downturn in output in parts of Europe and the USA, Kite Consulting's John Allen predicts that raw milk prices could even go above 30p/litre. "It's not considered a matter of 'if' the market turns, but simply a matter of 'when'."......
The report also points out that the UK now leads the rest of Europe in terms of restructuring and efficiency, following deregulation in the 1990s. And with a growing UK population, dedicated supply chains and almost zero quota costs, British dairying is well-placed to reap the benefits of any upturn in the market.
It also seems that, while British dairy farmers are currently reluctant to invest, increased dairy inseminations last year are leading to an increase in productive heifer numbers to rebuild the herd, should farmers rise to the challenge.
Not everyone will benefit, of course. As market volatility remains, weaker businesses will fall by the wayside. But efficient, flexible businesses are well placed to prosper.
"We therefore remain confident for the future of good farm businesses," says the report. "For the first time in many years, the building blocks are in place to stabilise our industry."
Yep, I have to admit this report has put me in a far better mood as the weekend approaches. Now all we need is Murray Mint to win at Wimbledon, the British Lions to get their deserved revenge in South Africa, and for me to catch a double figure carp on Sunday.....
* For more blog postings click here. To sign up for email alerts click here
| Tweet |
|
Is there some tennis going on? I never would have known... :)