Milk quota prices ease 4ppl

Wednesday, 28 January,1998

By FWi staff

CONFUSION over recent milk production figures has contributed to a fall in the price of milk quota, say agents.

Intervention Board figures released earlier this month showed a 13 million-litre increase in weekly milk production .

Quota prices soared by 10p to 60ppl shortly afterwards. But Intervention Board officials revised their figures downwards by 10 million litres a week later and the panic buying spree now seems to be over.

Friesian quota prices have eased by 4p and supplies are said to be sufficient. Unused Quota at 4% butterfat is currently selling for about 57.5ppl. Used quota is selling for about 40ppl.

Quieter trade has been fuelled by the suspicion of inaccurate production figures and lower milk-cheque returns, report agents Bruton Knowles.

The inaccurate production figures may have “put the frighteners” on farmers, says Roger Lightfoot of agents Hobbs Parker. But this weeks price fall is most likely due to the market for unused quota climbing too high and then overheating, he adds.

The market for forward leasing is also very quiet, according to agents Carter Knowles. However a very small supply of “Cohort” quota for those farmers involved in the selective cull is in great demand. Friesian quota is changing hands for around 15ppl.

Latest figures show that milk output is now level with profile. But the cumulative surplus is still running at about 120 million litres above profile with only nine weeks to go. Farmers still face a hefty super-levy.