Production
After a slow start to the milk year (April-March), autumn production has pushed up overall deliveries. GB production, according to the AHDB, is estimated to have totaled 1,018 million litres in November, up 4.4% compared with November 2023. For the season so far (April – November) GB production is at 8,279 million litres; 0.4% above the same period in 2023. Stronger farmgate milk prices, lower feed costs and (according to AHDB) an increase in Autumn block calving, has seen an increase in milk production over the last few months. In contrast, GB organic deliveries, for the period April – October are estimated to be down by 9.3% on the year to 203.21m litres.
The expectation is for conventional production to remain strong until the end of the milk year due to higher farmgate prices underpinned by strong commodity markets. The AHDB is forecasting GB milk production for the current milk year to reach 12.43 billion litres; 0.9% more than 2023/24.
Producer Numbers
The latest AHDB survey reveals dairy producer numbers in GB have fallen to 7,200. This is a reduction of 30 since the last survey in April. However, when compared with last October’s survey, numbers are down by 300, indicating the majority exited the industry last winter, when margins were particularly challenging. Better prices throughout the summer looked to have help stemmed the outflow. The survey also shows the average milk production per farm in GB has now risen to 1.7 million litres per year, showing the continued trend towards fewer, but larger farms.
Prices
Commodity markets are starting to ease as the Christmas trade comes to an end and milk deliveries continue to increase (see above). However, in the UK, manufacturers have limited stocks meaning prices remain supported, at least for the time being. But there is an expectation that prices will experience a seasonal decline in the New Year. At the latest Global Dairy Trade event held on 17th December the overall index fell by -2.8% to average $4,148; this is by far the largest decline since July, the only other two being by -0.4% and -0.3% in September and October respectively. An early look at farmgate prices for January show both Barbers (Cheese) and First Milk holding their prices. The former having risen its price for 11 of the 12 months in 2024.