Significant recovery in the global dairy trade may not happen until after spring next year, an analyst has suggested.
The Global Dairy Trade (GDT) auction took another hit on Tuesday as prices declined 7.9 per cent, representing the trade’s third consecutive fall.
It came as discontent once again grew at farmer level in the UK, with accusations of threats to farmer contracts amid a renewed appetite for direct action.
Dairy analyst Chris Walkland said the industry was unlikely to see significant recovery until after the ’flush’ of milk likely to come onto the market during spring.
"As for when things pick up, it is not going to be before the flush which will be in April, May, June," he said.
The sale saw 30,044 tonnes of product sold at an average of about £1541.65/t (NZ$2,345/t).
"Things might tighten in the UK quicker than we might think, if Farmers For Action [FFA] gets other farmers to step up to the mark who knows," Mr Walkland said.
Mr Walkland added milk production could fall over winter, boosting spot prices, but suggested it was unlikely to raise prices to levels required.
"The big question is what will happen to UK milk volumes over the winter and the effect on the domestic market," he added.
The GDT fall came just hours before a controversial FFA protest at Meadow Foods in Cheshire on Tuesday night.
FFA chairman David Handley said the protests showed the extent of farmer anger at so-called ’middle-ground dairies’, such as Meadow, and their ongoing cuts to milk cheques.
Pledging to continue protests well in to winter if members sanctioned it, Mr Handley also hit out at the NFU for what he claimed was the union’s refusal to back Tuesday’s blockade.
Mr Handley said the global dairy market was likely to continue its downturn.
"I think there are a number of dairy farmers who need to to look at their business and make a decision," he said.