Milk output over quota for first time in August - Farmers Weekly

Subscribe and save

Farmers Weekly from £133
Saving £46
In print AND tablet

SUBSCRIBE NOW

sub_ad_img

Milk output over quota for first time in August

By Robert Harris

MONTHLY milk production exceeded quota for the first time this milk year during August, according to the latest Intervention Board figures.

Provisional estimates show almost 1.145bn butterfat-adjusted litres of milk were delivered to purchasers during the month, 6.3m litres, or 0.55%, over profile.

But despite further gains from a small upward revision in July output, cumulative production for the milk year remains well below quota. The shortfall is more than 148m litres almost four days supply. This time last year, output was 106m litres over quota.

Quota prices have held up as a result. Leased 4% butterfat quota supplies are trading at 4p/litre.

Peter Weston-Davies of the Farm Consultancy Group says: Agents put up leasing prices by 0.5p/litre since the start of the week, as they have done every time the production figures have been due out.

When the output figures were well under quota, they let themselves be beaten down by the same amount. Now they will make every effort to see that the rise sticks.

If you need some, cover some requirement now. But dont stick all your eggs in one basket.

Mr Weston-Davies reckons sales quota is 19.5p/litre for 4% butterfat up 2p/litre on the month.

Cumulative production to the end of August is about 100m litres below the level seen in 1998, a year when the UK only just made quota, he says. But this autumn, a lot of cows will be offered silage of questionable quality, and many farmers will struggle to buy extra feed.

There is no doubt that farmers should be paid more for milk, says independent consultant Mike Bessey, who reckons that 2000 could be one of the best years for the EU dairy industry in the past decade.

    Read more on:
  • News

Milk output over quota for first time in August

15 September 2000

Milk output over quota for first time in August

By Robert Harris

MONTHLY milk production exceeded quota for the first time this milk year during August, according to the latest Intervention Board figures.

Provisional estimates show almost 1.145bn butterfat-adjusted litres of milk were delivered to purchasers during the month, 6.3m litres, or 0.55%, over profile.

But despite further gains from a small upward revision in July output, cumulative production for the milk year remains well below quota. The shortfall is more than 148m litres – almost four days supply. This time last year, output was 106m litres over quota.

Quota prices have held up as a result. Leased 4% butterfat quota supplies are trading at 4p/litre. Peter Weston-Davies of the Farm Consultancy Group says: "Agents put up leasing prices by 0.5p/litre since the start of the week, as they have done every time the production figures have been due out.

"When the output figures were well under quota, they let themselves be beaten down by the same amount. Now they will make every effort to see that the rise sticks.

"If you need some, cover some requirement now. But dont stick all your eggs in one basket."

Mr Weston-Davies reckons sales quota is 19.5p/litre for 4% butterfat – up 2p/litre on the month.

Cumulative production to the end of August is about 100m litres below the level seen in 1998, a year when the UK only just made quota, he says. But this autumn, a lot of cows will be offered silage of questionable quality, and many farmers will struggle to buy extra feed.

Tony Carver of Carver Knowles agrees, saying that poor milk prices are unlikely to help production. "Farmers are not going to bust a gut when they are not being paid for it." Mr Carver suspects leasing prices may ease back.

There is no doubt that farmers should be paid more for milk, says independent consultant Mike Bessey, who reckons that 2000 could be one of the best years for the EU dairy industry in the past decade.

But UK producers have not benefited, even though skimmed milk powder prices have increased by one-third since January to £1680/t, and bulk butter values by 6.2%. Together, that is the equivalent of 4p/litre of raw milk.

Mild Cheddar has also risen by 5%. "Usually, when markets rise, everyone does well," says Mr Bessey. "UK farmers are the exception. The market can afford to pay more."

The immediate outlook remains buoyant, he says, because there is no reason for EU skimmed milk powder prices to weaken significantly this side of the new year. "Many makers have sold forward and spot EU supplies are likely to be in short supply." &#42

    Read more on:
  • News
blog comments powered by Disqus