Trade for milkers continues to soar.
Spring has bought about an influx of herd sales and while it is great to be busy, one wonders about the long-term effects this is going to have on the dairy industry.
None of the conclusions drawn are positive ones.
You would imagine that the rise in milk price would be having the exact opposite effect, but there are numerous reasons for the exodus.
Global influences
Global influences, not least from the ongoing crisis in the Ukraine, have seen on-costs, such as fertiliser and fuel, soar in price. And unfortunately, milk purchasers have been slow to react, in respect of raising the price per litre.
This has resulted in some unprecedented actions from buyers with producers seeing two increases in the price per litre during the 鈥榤ilk flush鈥� period, with some as much as 2p. However, most would suggest that this is still not enough.
This financial pressure alone has been enough for some to leave the industry. But the foremost problem
is the continued labour issue within the sector.
Time and time again, we visit farms where they simply cannot continue, due to a lack of staff.
And when we are in times of choice when it comes to land use, with incomes available from alternative sources such as solar, which mean you do not have to get out of bed at the crack of dawn every day and run yourself ragged, then why would you not hang up your overalls.
Optimism
If that was not reason enough, the trade for milkers has continued to soar and despite the numbers coming onto the market, prices still hold strong.
Optimism from buyers may be because we are still 3 per cent behind in production for the same time last year and consequently the price per litre is still set to rise.
In the future, on-costs will level out and there could be a real opportunity for a honeymoon period, where some sustained and considerable profit can be accumulated by producers.
Either way, it means a very busy few months ahead for the Dairy Section at Leek, with dispersal sales booked throughout May and then on into summer.
One hopes for an ongoing strength in the trade for those who decide it is time to depart.
For those that are set to continue, let us hope that the true value of milk is finally being recognised.
Meg Elliot
Meg Elliot is a pedigree dairy auctioneer and chartered surveyor at Leek Auction and Bagshaws LLP.
Call 07967 007 049, or email [email protected]
