UK Forage Running Low As NFU Warn On Milk Prices
The NFU have warned milk buyers against paying dairy farmers 'too little too late' when it comes to the recent rate of modest milk price increases.
"Up to 4.3ppl in additional revenue is being made by milk processors on the back of strong commodity markets, so with increases of as little as 0.5 up to 1.5ppl announced since June, there should clearly be more to come," they said.
Meanwhile forage supplies are already running low, with many farmers suffering losses of 20-30% on first cut silage and up to 50% on the second cut, they added.
The recent hot and dry weather has also forced many farmers to house their cattle indoors, pushing up costs further with straw prices so expensive at the moment, they say.
Many farmers are already feeding what little forage they have, meaning that supplies this winter look like being particularly tight, they warned.
Happy Birthday Milk Quotas - 25 Years Old
A belated happy 25th birthday to milk quotas. Introduced on Apr 2nd 1984.
When quotas were introduced we were the only country in the EEC producing less milk than we consumed (85%). Yet the UK took the biggest cut at 6.5%, sounds like a familiar story.
Created as a better way of stemming the flow of dairy farmers out of the industry than price cuts.
There were just under 40,000 dairy farmers in the UK in 1984, Now there are around 12,000.
The exodus of farmers from milking could result in Britain having to import more than half its dairy products by 2030, if current trends continues, according to DairyCo.
By then UK production would be just 7.5bn litres. In its latest survey, a further 14% of dairy farmers intended to leave the industry within two years.
NFU Condemn Arla And First Milk
The NFU has condemned Arla and First Milk's recently announced price cuts as 'unjustified' and 'disappointing' saying that they are “exploiting the poor one-sided contract“ with farmers.
Not surprisingly neither company sees it quite that way.
Arla blames the reduction on a falling commodities market, the effects of which it says it absorbed in the second half of 2008. Meanwhile First Milk blames the European milk price slide which it says is now affecting the UK.
An unidentified NFU spokesman offered to take the Arla and First Milk executives on in the car park for a fight, according to reports circulating in my head.
Nogger betting on the winner of this intriguing three-way bout:
Unidentified NFU punter, probably a big strapping ex-farmer type 4/6 fav
First Milk Chief Executive Peter Humphreys, probably not had a fight since he was twelve 3/1
Hanne Sondergaard, deputy CEO of Arla Foods UK (could be a woman with a name like that) 12/1
Win only.
Arla And First Milk Announce Price Cuts
Arla and First Milk have both announced producer price cuts with immediate effect.
Arla has dropped it's standard price by 2ppl from January 5 while First Milk has cut by 1.25ppl from January 1.
Arla blames the reduction on a falling commodities market, the effects of which it says it absorbed in the second half of 2008. Meanwhile First Milk blames the European milk price slide which it says is now affecting the UK.
UK Milk Production Hits 34 Year Low
UK wholesale milk deliveries totalled 982.2m litres, 31.8m litres down on last year and the lowest level November 1974, according to latest Rural Payments Agency figures.
Cumulative production for 2008/09 now stands at 8,635m litres, 229m litres down on November 2007.
"It's a harsh reminder of the pressures and lack of confidence on dairy farms at the moment," NFU chief dairy adviser Hayley Campbell-Gibbons commented.
Dairy Crest And Wiseman Raise Prices
Dairy Crest and Robert Wiseman Dairies have announced producer price increases.
Following an earlier announcement of 1ppl from November 1 from Wiseman, the Glasgow processor this week honoured its promise to review October and announced 0.4ppl for the month – effectively then increasing again by 0.6ppl on November 1.
Dairy Crest meanwhile, has announced a 0.5ppl increase for suppliers on its standard liquid contracts from November 1 – except those in Sainsbury, Waitrose and Marks & Spencers milk schemes.
Dairy Farmers Say Supermarket Fat Cats Getting The Cream
Farmers are being short-changed over milk and supermarket fat cats are lapping up the profits, the Farmers' Union of Wales said today.
"Whilst Tesco are demanding farmers reveal their accounts to an independent assessor or suffer a 0.5p per litre penalty, there is little or no such transparency further down the chain," said FUW's vice president Brian Walters at the Welsh Dairy Show in Carmarthen.
"The closest we have to transparency is data just published by DairyCo on the 2007 dairy supply chain margins," said Mr Walters.
"These figures suggest that last year processors failed to pass prise rises on to farmers. However, this does not constitute anything like the transparency being demanded of farmers by Tesco."
The report - "Dairy Supply Chain Margins 2007" - concludes that the delay between increases in retail prices and farmgate price rises meant many farmers were short-changed by tens of thousands of pounds at a time of rapidly rising production costs.
Britain Imports Record Quantities Of Milk
The BBC is reporting that British milk retailers and processors have been forced to buy in a million litres every day from Northern Ireland, Holland and Belgium.
The shortfall is because so many dairy farmers are going out of business, with two a day leaving the industry due to low prices and high costs, they say.
In addition, a poor summer has also reduced cows' ability to produce high levels of milk. These two factors combined mean British milk production is at its lowest for more than 30 years.
Last year, the number of cattle in Britain fell by 200,000.
That should please the anti-methane brigade then? And another thing, how do they know that the number of cattle fell by that amount? There could be 21,000 of them in hiding according to DEFRA.
UK may have to buy milk in before long
THE dairy industry is warning that the traditional daily pinta is at risk as UK milk output sinks to its lowest level in 39 years.
Domestic milk supplies are fast approaching the 1971 levels when national output was 12.9bn litres.
In that time the dairy industry made huge efficiency gains but the number of milk producers has plunged amid falling economic returns.
Milk experts Kite Consulting has predicted the UK could be facing a shortage of milk by November 2011. The country would then become reliant on milk imports and exposed to the vagaries of global markets.
NFU Cymru president Dai Davies said: “Everyone involved in buying, processing and retailing milk need to wake up to the fact that security of supply is no longer guaranteed.
“Unless action is taken to increase production, the UK could be seeing shortages of British-made milk, cheese and other dairy products.
“We could be facing a situation whereby shoppers may not find the full range of British dairy products on the shelves. Shortage is a real threat.”
Figures from the Rural Payments Agency show that between April 2007 and March 2008, milk production fell to 13.2bn litres – down from the previous annual figure of 14.1bn litres.
Annual milk demand in Britain is around 12.6bn litres, with consumption rising 3% in the last 12 months.
Milk prices rose last autumn but profit gains were mostly wiped out by rising prices of inputs such as feed and fuel. Farmers say they need at least 30p a litre to remain viable.
