Quota concern pulls milk down

UK DAIRY farmers delivered 1.207bn litres of milk to processors during April, according to provisional figures from the Rural Payments Agency.

The figure is 66-71m litres below the past two seasons, partly because many producers had been reining back on milk production since December to avoid going over quota in the past milk year.

Butterfat content was 3.99%, 0.1% higher than last season but the same as 2002/03.

“I thought the shortfall might have been bigger,” said Tony Carver of broker Carver Knowles.

“But it has been a very difficult start to the new milk year to weigh up.

“Cows in some areas have been in and out of buildings like yo-yos, and it looks as though there is fairly big exit going on among English producers.

“There are a lot of cows on the market – while many of these will remain in the herd, producers are also taking the opportunity to clean up their herds, and have been culling early.

“Unless we have a very special spring it is going to be a hell of a job to fill quota this year.”

Mr Carver values leased quota at about 7.3p/litre for 4% butterfat, but supplies, in England at least, are sparse.

“Very few producers are prepared to lease out their spare quota at that price.”

Conversely, there is plenty of sale quota available. While 4% butterfat quota is worth 13.5p/litre, he expects the price to slip back.