Nightmare for quota lessees

By FWi staff

WHAT has been a good year for quota lessors has certainly not been a good one for lessees, with milk quota leasing values reaching a year high.

Leasing values started the year at 6ppl before dropping down to 5ppl in reflection to the lower milk values.

But with milk production consistently over profile so far this year prices soon rose.

The autumn saw a stand-off between lessors, who were holding back for more money, and the lessees, who would not pay the asking price.

But it was not until the November production figures were released earlier this month that prices started to soar climbing to over 10ppl for 4% butterfat as frantic producers tried to secure quota.

But falling milk prices have meant that many are now unable to pay these values, and producers are expected to cut feed and cows to reduce production.

This will be a tall order, with production now more than four days over profile at 140 million litres.

quota link
Bruton Knowles

Clean and used quota prices have been steady although with the deadline for trading not until March next year values could still firm depending on milk production.

The situation is a stark contrast from last year when the UK was 20 million litres below profile.

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