By Simon Wragg
YEARLING dairy stock is facing a tough trade as farmers with flying herds, in particular, opt for plentiful and cheap dairy heifers.
And with milk production continuing apace, more pressure is expected as quota becomes the buyers priority.
Year-old heifers are fluctuating between £120-£150 apiece at main dairy centres and fewer buyers are at the ringside than in previous years.
Pressure on winter housing as average herd size increases is one factor, cost of rearing young heifers to first calving another.
Hugh Evans of Carmarthen says the margins are becoming too tight. Bulling heifers at £250 each could cost £280 in keep before calving down.
And when fresh heifers are plentiful at £500-£550 a head without any risk of losses, many producers are not taking any chances.
“Even the men who would buy these younger heifers and rear them on have moved over to rearing suckler replacements. It used to be a lucrative sideline in this area, but many are not seeing the money in rearing, training and presenting dairy heifers to the market.”
But perhaps a chance is being lost, argues Andrew Wallace of Wright-Manley. “We all know more beef semen is being used and heifer numbers will eventually come back. Perhaps the time is right to look at year-old heifers; at these prices some do not look a bad bet.”
To take the risk, producers will have to be bold, adds Brian Ross of Lanark market. “But there is not a lot of optimism.”
Also, the large number of dairy dispersals is adding to the over-supply of replacements coming to the market. These will have to be worked out of the system before prices start to firm, he argues.
Auctioneers are in no doubt youngstock trade is going to be difficult this autumn, says Mark Elliot of Uttoxeter.
That will not be helped by latest milk production figures for September, which suggest quota is 1.6% ahead of profile.
“It is not helping at all,” adds Mr Ross. Producers will have to move and lease-in quota and that will put a brake on spending elsewhere, including replacement stock.
And worse is to come. As calving reaches its seasonal high, Mr Evans believes a further contraction of the market is likely.
“The quota situation has not affected the market as hard as I feared. Expect more pressure next month.”