26 September 1997

The California vicious circle

Neil Rowe, Oxon dairy manager for Marcham Farms, milking 170 cows: "Every time the milk price drops in California, dairy farmers produce more milk which reduces prices even further.

"Their milk price is now down to 12p a litre. Farmers with 1000 cows are making profits of just £14,000 a year. So rather than expand, Im down-sizing from 170 to 90 cows and switching from three-times-a-day to twice daily milking.

"Well make more money doing this than by keeping an extra 15 cows and putting 500 litres on the average. Reducing cow numbers will also allow us to lease out 250,000 litres of quota and halve our labour costs. Then in five years time, well expand for less money than it would cost to do so now.

"Well also try to get as much as possible off home-grown feeds. That means ploughing up all our grass. Because we dont want to grow non-IACS crops on IACS land, well concentrate on maize and winter wheat for whole-crop silage."

David Homer, milking 110 cows near Marlborough, Wilts: "We took advantage of the higher milk price to invest in updated parlour facilities and bought a new tank to cope with every other day collection. This should ensure we can produce milk more economically."

Were also trying to maximise use of home-grown feeds."