Ample supply pushes down quota prices
By FWi staff
CLEAN milk quota prices have fallen visibly over the week with slow demand and ample supply leading the market.
This market correction has been caused by the unsustainable differential between clean and used markets which, to a certain extent, still remains, said Mark Dyson of Exeter-based Townsend quota agents.
“Many buyers are holding off until February production figures are announced. Vendors with large holdings still to sell should possibly consider hedging a proportion now.”
Clean quota of 4% butterfat has dropped to 32.5ppl with 3.78% falling to 30ppl.
Used quota is plentiful and hence prices have eased slightly although trade is steady at this level, said a spokesman from ADAS Quota Direct.
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Quota of 4.07% is selling at 20ppl with 3.70% at 18ppl.
The forward leasing market continues to be very quiet at present, and a spokesman from WebbPaton quota agents said there was almost no interest at all.
With the lack of interest, values have dropped again this week with 4% butterfat at 4.4ppl and 3.76% at 4ppl.