13 June 1997

Milk slides from peak into summer trough

MILK production peaked in May, according to latest figures from the Intervention Board, and has now started to fall into the so-called "summer trough".

In volume terms, Mays deliveries were almost identical to last years at 1.312bn litres. But butterfat was lower, leading to a slight drop in adjusted deliveries. These stood at 1.354bn litres – or 3.27% over the Intervention Boards new quota profile.

Cumulatively, UK output is now 135m litres (5.4%) over quota after the first two months of the milk year – equivalent to three days supply.

Following this "milky" start, and coupled with more bullish news about the long-term prospects for quotas from Brussels, quota prices have firmed to 53p/litre for 4% butterfat lots, and over 11p/litre to lease.

Anecdotal evidence from the trade, however, points to a slowdown in deliveries to milk factories with more capacity now becoming idle.n