Foot-and-mouth worries dog quota business

By FWi staff

THE milk quota market is almost at a standstill, as uncertainty about the 2001-2 quota years is rife among producers threatened by foot-and-mouth.

Trading in lease quota for this milk year has all but finished, with the deadline for lease deals tomorrow (30 March).

“There was a rush of last-minute interest last week, but there was very little quota about as most had already been leased, so that holders didnt lose it before the agrimoney compensation arrives,” says Jonathan Smith of BK National Quota Exchange.

Interest in forward lease quota is also quiet, although a few deals are being done, adds Mr Smith.

“Those that are leasing are mainly doing it as an insurance measure, and there are always some bargain-hunters making the most of the low price.

“Interest in the purchase market is even quieter, with most producers waiting to see the outcome of the foot-and-mouth crisis – there is a lot of uncertainty in the market.”

Lease quota for the current milk year finished trading at about 0.2ppl.

The forward leasing price has dropped to 1.5ppl for a 4% butterfat from 3.5ppl when trade first started in January.

Clean quota sales are trading at about 15ppl for a 4% butterfat with 3.85% supplies at 14.5ppl.