Friday, 3 March, 1998

By FW staff

DAIRY farmers are taking panic measures to avoid superlevy without calculating how much they can afford to pay, it was claimed today.

The small volumes of quota available under the extended leasing scheme hit a top price of 17ppl last week, after official figures showed a rise in milk output for the second week running.

But farmers heading for a surplus this year should aim to cut back production between now and the end of the quota year in April, according to Huw Rees of Milk Marque. “Those seeking to acquire quota should be very careful not to pay more than they can afford,” he says.

UK national production figures to the end of February will be available on 9 March. Milk Marque estimates the UK surplus will be some 84 million litres – around two days worth of production – if butterfat is consistent with last years levels and the downward trend in output returns.

Meanwhile, demand for clean quota has slackened, according to agents Bruton Knowles. Quota at 4% butterfat eased by 1p to 55ppl.

Large volumes of used quota are now coming on to the market although demand remains low. Purchasers should expect to pay about 36ppl. Leased quota is now trading at 8.3ppl, according to agents Ian Potter Associates.

  • For this and other stories, see Farmers Weekly, 27 February-5 March, 1998

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