Clean quota price slips back

By FWi staff

CLEAN quota values have slipped back over the past few days on the back of a reduction in demand.

The volume entering the market has increased again over the week, although demand has eased as buyers wait and see what happens to prices.

“But the interest is still good, even if demand has eased,” said Jim Leamon of Hamiltons National Milk Quota Agents.

The next few days will be crucial in seeing whether prices have peaked or will rise further, said a spokesman from Lovedays National Milk Quota Agents.

Aftrer rising to 41ppl for 4% butterfat, the sale of clean quota has now slipped back to 39.5ppl for 4% butterfat and 37.5ppl for 3.87%.

Used quota also eased as availability improved, and prices fell back to 39.5ppl for 4% butterfat and 3.87% at 31ppl.

Trade remains slow for forward leasing, although interest is improving, said Mr Leamon. “Lessees are looking for 7ppl, although last year they increased to 8ppl.

Supply has tightened and prices inched up on the back of this. Butterfat of 4% is now about 7.5ppl.

The key factor is the production figures, said Mr Leamon. “National production fell towards the end of last year. The quota was expensive and this put a brake on production,” he said.

He believes that production should increase slightly in February, and that the UK will be on profile by the end of the quota year. “But it wont be wildly over,” he said.