Milk peak leaves super-levy confused

By FWi staff

THE milk supply figures for March show a sharp rise in production, leaving the likelihood of a super-levy in confusion.

The figures released by the Intervention Board show that production has risen to 64 million litres over quota for the month of March.

This changes the cumulative position for the year to 13.5m litres over quota before the conversions between wholesale and direct sale are taken into account, said a spokesman from quota agents, Lovedays.

Permanent conversions will add 19m litres to the wholesale quota pool which has to be deducted from the cumulative total. This leaves the UK six million litres under quota for the year.

The net temporary transfers from wholesale to direct sale, which can be lodged with the Intervention Board until 14 May, will not be known until July/August.

Peter Weston-Davies of quota agents Charles Holt Consultancy believes that as much as 20m litres could be transferred between now and May.

The direct sales producers will want to avoid the super-levy they received last year at 17ppl, and they know its close, he said.

If that amount is transferred the quota year could finish 15m litres over.

Purchaser groups that are over quota may still have more generous thresholds than in the 1997/98 year, said Mr Weston-Davies.

“Therefore, it is likely that farmers who are 10% plus over are the ones that would carry the super-levy can.”

David Heaper from the Intervention Board isnt so sure. “Its the million Dollar question that everyone wants to know,” he said.

Mr Heaper told FWi today that the figures are so close that it is impossible to speculate. “Theyre right on the very edge.”

Rachel Rutter of Whitchurch based quota agents, Wright-Manley was reserved over the possibilities of super-levy saying that the figures could be closer to quota than was first thought.

There were a lot of farmers banking on the fact that there would be no super-levy this year, and to make any comment would be tempting fate, she added.