Milk production creeps over profile


By Olivia Cooper


MILK production has crept above profile for the first time this season, but butterfat-adjusted figures for the milk year to date continue to show a big deficit.


Unadjusted November milk production was pegged at 1.06bn litres by the Rural Payments Agency.


 

This is 53.5 million litres ahead of last November, but butterfat-adjusted production is still 168.9m litres under quota profile for the year, says Charles Holt of the Farm Consultancy Group.


“This is a huge amount to catch up, and the chances of doing so are extremely slim.”


But John Duncan, chairman of co-op First Milk, disagrees.


“If production continues at current levels, we will end up a lot closer to quota than we expected just a month ago.”


“Having expected production to be 6-7% down, in October, we are actually finding producers are delivering 7-10% over their contract volumes.


“This is obviously putting pressure on prices, but we will wait until January to see what production and commodity values do in December.”


Poor commodity prices meant spot milk levels fell sharply in November, by about 2ppl – to just 15ppl in some areas, although markets have since improved by about 1ppl, says independent consultant, Michael Bessey.


“Butter and SMP have fallen to intervention levels, which has put a base in the market.


“But UK producers need to watch out for cheese prices, which dont have that support.”


Demand should be firm through Christmas and into the New Year, but traditionally drops off in January and February, which could have a significant impact on raw milk prices, he says.

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