We were warned to expect volatility.
They, that is all those people who know more about dairy farming than us but rarely have any cows of their own, told us to expect volatility. “When quotas go and supply and demand get out of balance, there will be ups and downs with milk prices to contend with.”
“But don’t let it worry you too much because the long-term trends look good.”
“Billions of people in the world are looking for a middle-class lifestyle and a middle class diet.”
However, they didn’t foresee the expanding Chinese economy suffering a serious blip so they wouldn’t be out there buying everything they could that had ‘dairy’ written on it.
They didn’t foresee the issues in the Ukraine that ended up with tit-for-tat sanctions and Russia not buying EU cheese. So here we are, bumping along in a very bad milk price place, hoping this is the bottom of the cycle, that this is as bad as it will get.
But because no one knows with volatility, it could get worse before it gets better. Wise heads on platforms have predicted three to four year cycles of volatility, which in dairy farming terms is quite a short cycle. It infers a year of good, a year of bad and a couple of years transition between the two.
Now those same wise heads are predicting we are stuck with these prices for another seven or eight years. The question for a lot of us is do we want to milk cows for another seven or eight years with the arse out of our trousers?
And if the response is no, that will be the answer to volatility and the end to low prices. But it won’t be because demand is outstripping normal production, it will be that in the long term we can’t produce milk at these prices and there will be a drastic reduction in supply.
Historically, only 5% of dairy produce was ever traded internationally, but the low price of this small element is used to drag all prices down. Milk price has gravitated to the lowest common denominator.
And I can’t quite see where the good times are going to come from. Big retailers have such a stranglehold on their suppliers that I can’t ever see the good times happening. Looking for a way out has got to be an option lots are looking at. What concerns me is because our industry comprises thousands of individual, mostly family, businesses, there is no way of knowing how much damage is being done.
The banks know, and if they were to get together and pool that information we would as an industry have a better idea of where we were, and where our industry was going to end up.
I’ve never been a big New Year person. Over the years I’ve been to good New Year’s Eve parties but those would be a lot less than the nights I have stayed at home and gone to bed at the normal time. What’s always been at the back of my mind is the question: “Do I need this late night and the following hangover if I have to be up to milk the next day?”
Getting up to milk is not an issue for me as there is very little about the yard I am able to do anymore. I have become a goingto- fetch things sort of person and a tractor driver. So when my lady carers offered to take me on a New Year’s Eve pub crawl, I said yes. I’ve always been wary of the mass kissing that takes place at midnight.
I’ve always tried to weigh up the numbers of those I wanted to kiss compared with those I didn’t, so as to try and assess the balance. Trouble is, if you try to sit out of sight in a corner, there are those who will seek you out. So rather than put up a fight I now find it easier to kiss everybody. We had a good night out and I got home two hours later than my teenage grandsons.
They were well impressed. I’ve never had any trouble getting to sleep. If you are like me, you have spent most of your dairy farming life tired.
Quite why the Good Lord, when he created milk, decided those who produced it had to manage with less sleep than everyone else is beyond me. The only sleep problem I have is if I am woken up, I find it difficult to get back to sleep again.
Bawling cattle never wake me, nor do chicken feed lorries. Even alarm clocks have to be persistent. No, the things that wake me are dreams. I have lots and lots of dreams and they wake me most nights.
I can wake up, go to the loo, and start the dream back up again! Three of four times a week I dream I am in the fighting with the French resistance in the Second World War. I’m mostly woken up by a mine under a railway line or a carelessly tossed hand grenade.
I’m not telling you this because I think you’ll be remotely interested in my bizarre dreams. But this dream is always in black and white and I just thought you’d be impressed with the attention to detail!