Dairy cow values spurred by demand

By Robert Davies, Wales correspondent

FIRM demand is keeping the market value of dairy cows well above last years depressed level, despite prices dipping a little in the last fortnight.

Auction reports indicate that milkers are being knocked down for an average of around 650/head – a year-on-year increase of 200.

Some quality commercial cows are making over 900/head, but the welcome improvement still leaves dairy cow values way below what they were when the farm-gate milk price peaked after deregulation.

Below quota production and anticipated increases in the milk price are the two factors stimulating current demand for cows.

Terrible autumn weather, below-average quality winter fodder and a reluctance to use expensive concentrates to buy more milk production means many herds have been operating well below quota.

Rather than leasing out unfilled quota in a weak market, producers have bought extra cows, especially in the south and west of the England, where milk can be produced cheaply from grass by turning cows out early.

Auctioneers report interest in good commercial cows in the 650-800 price range. But they say that the milk price will have to rise significantly to improve the continuing lacklustre demand for more expensive milkers.

Vendors are also getting a premium of about 100/head where there are records indicating that cows have good genetic merit and low cell counts.

Oliver Hiles, of Wright Manley, describes trade in commercial and pedigree dairy cows at Beeston Castle Auction in Cheshire as very steady, and he expects good prices at least until the start of the new quota year in April.

“What happens then will depend on the milk price. If it goes up there will be a head of steam to drive prices higher, especially as many producers are planning herd expansions.”

quota link
Bruton Knowles

See more