17 August 2001

Buoyant milk production levels will not continue

MILK production could plummet this winter as a result of foot-and-mouth, says Britains largest farmer-owned dairy business.

First Milk chairman John Duncan says: "The milk industry is facing a cliff edge in late autumn. Buoyant production levels, which have seen output stay ahead of last year despite the F&M cull, will not be sustained into the winter."

Milk production has been strong due to the number of extra cows kept on farm because of the Over 30-Month Scheme suspension. "But farmers are telling us they cannot bear the costs of feeding and housing these cows through the winter months."

Although the OTMS is running again, only 9000 animals/week are being processed, compared with the normal demand of about 13,000 cows. The backlog is not falling and First Milk expects production to be above average until October.

"But by November, only a fraction of this extra milk will still be in production," says Mr Duncan.

Compounding the effect, one in three cattle was subject to an average of six weeks delay for insemination. Where they should have been coming into milk in the New Year, there will now be a "serious shortfall" in the first quarter.

Latest Intervention Board figures for July milk production mirror this trend, with production 8.2m butterfat-adjusted litres above July 2000, and only 9.4m litres below the annual quota profile.

"The production was much as we expected," says Charles Holt, of the Farm Consultancy Group. "But the butterfat content at 3.86% was significantly higher than predicted, which obviously affects the butterfat-adjusted litreage."

"Production in 2000 was 347m litres below quota, so we really should be ahead of that figure this season. Cumulatively, we are still 112.8m litres below profile so far this year," he adds.

The market has been very quiet this week, before the release of the July figures. Prices have weakened to about 1p/litre for 4% leased quota, and despite strong demand, sales have steadied at about 16p/litre.

&#8226 The Milk Development Council has launched a project providing £1000 to Britains smaller dairy farmers for financial and advisory support. For further information contact 01285-646515. &#42