By Tim Relf
MORE dairy cows have probably hit the market this autumn than ever before.
But trade for the better ones has held up remarkably well, say auctioneers, with prices above last years levels.
“A lot better than expected,” says Derek Biss, of Greenslade Taylor Hunt.
Propping up values of the best stock are the tight supplies. “There is a desperate shortage of top animals – there are always plenty of buyers to snap them up when they come on the market.”
Cohort money is still being reinvested, and the recent increase in TB compensation from 75% to 100% of an animals market value means affected farmers have a little more to spend.
But it is a different story at the bottom end of the quality spectrum, where the big number on offer is compounding matters. Cattle were very cheap last autumn, so a lot of people bought them for, say, £300 to milk and kill. “But they didnt kill them, they kept them and are getting rid of them now when they leave the industry,” says Mr Biss.
Cooper & Tanners David Millard says: “Considering the number of sales, trade has held up extremely well – better than many of us feared.”
He, too, says its been a busy spell for auctions. “Its been a year of greater change in the dairy industry than for many years.”
Some sales have been brought about by retirements, others by the lower milk returns. “We have seen a few younger people go this autumn, too – people that feel that there is no future.”
The availability of farm business tenancies have also prompted a few to leave the industry, says Mr Millard. Other factors include a reluctance to invest in new facilities, the current tax regime and the growing paperwork involved.
With the autumn sales now drawing to a close, most people that are going to leave the industry this year have done so, reckons Mr Millard. “I dont think well see the same volume of sales next year.”
For farmers selling lower quality sorts, meanwhile, his advice has been to offer them through the market, rather than opt for a more expensive on-farm dispersal.
Meanwhile, the wish to improve genetics, expansion plans and natural replacement are behind the demand, he says. At Frome, the best calved heifers have been making over £700 and the £1000-mark is sometimes still hit at on-farm auctions.
Any rises in milk quota values, though, could hit stock prices. “Theres a definite – and fairly immediate – link between the two.”
Clive Norbury of Wright-Manley reckons some farmers, making winter production plans, have been buying in recent weeks. “Cows are not milking particularly well this autumn.”
But he dismisses talk of a flood of sales. “Cheshire and Shropshire are milk counties. What else can people do if they quit dairying?”