Search is on for milkers
DEMAND for dairystock is holding up well as farmers look to expand in the face of lower milk prices.
"Its remarkably good," says Wright-Manley auctioneer Clive Norbury. "Farmers are looking for milk."
The rush of dispersals many predicted for this spring did not happen – limiting numbers on offer, says Mr Norbury. For those who have quit, the desire to take advantage of retirement relief on tax has been a contributory factor in many cases.
"There could be a rush to sell after the May and June milk cheques have impacted on bank accounts," says Mr Norbury, who reckons values could fall later in the year. The number of heifers on offer is plentiful, too, reflecting the trend away from using beef bulls.
The demand for top-notch stock remains most buoyant. But on the commercial side, anything "off milk" – especially youngstock – is difficult to sell. "People arent spending money on anything that isnt going to give them an immediate return," says Mr Norbury.
Chris Reeks of Cooper and Tanner has also seen farmers "buying milk". Mostly, he says, people are looking for either close-to-calving or recently-calved animals. Mr Reeks saw prices reach 650gns for a heifer at a dispersal of 100 Holstein Friesians last Thursday at Devizes, Wilts.
Nick Hansen, auctioneer with Bagshaws, agrees there has not been no huge rush to sell in recent months. Some farmers have, however, been promoted to leave the industry by the lower returns.
"Those with more than one enterprise are saying: Are the cows paying their way? And some are deciding that its best to sell the cows and cash the quota." Quality remains top of buyers shopping lists, says Mr Hansen. Even fourth calvers are selling well if they are nice, smart animals. But poor-quality sorts, however young they are, will make little more than the killing price of around £300, he says.
Meanwhile average market prices of about £550 are little more than half the levels seen in 1994, says Mr Hansen.
Derek Biss of Greenslade Taylor Hunt reckons the next couple of months will be busier than usual, with farmers keen to avoid selling in the autumn, having seen a bad trade at time in the past couple of years.
"We have got four sales in four days at the end of this month, for example." This, in turn, might "spread the load" and give values a boost in the autumn. "But milk quota is the all-important factor -and if quota values rise, cow prices will fall." *