Vendors hold out for better quota prices

By FWi staff

MILK quota is being held back by vendors and lessors in the hope of better prices later in the year.

But quota values have so far risen only slightly, and buyers and lessees appear reluctant to enter the market at anything higher than the current price.

Leased quota at 4% butterfat is trading up 0.3p on the week at 6.8ppl. The trade in bought quota remains steady, however, at 34ppl.

A shortage of both sale and lease milk quota has forced prices to strengthen, according to agents Ian Potter Associates.

Other agents say that could change over the coming weeks. Its early days, says Mike Lewis at ADAS, and only two months into the trading year. With millions of quota litres yet to be traded, farmers chasing supplies can afford to wait.

According to Bruton Knowles, the supply of quota available now for lease is “plentiful”. Many lessees are looking for large quantities and it is increased demand, rather than limited supply, which have caused prices to rise slightly.

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