Dairy farmers have remained resilient despite the continuing serious downturn the industry faces.
Milk prices have remained unsustainably low throughout 2015, but experts told Farmers Guardian dairy dispersal sales were currently minimal and suggested there was little indication land prices would see any significant falls across the board in the coming months.
Carter Jonas’ James Stephen said land prices rose 2.5 per cent in 2015, but troubles in the dairy industry and other sectors were evident as farm values levelled out in recent months.
“The fall in global dairy commodity prices due to an imbalance of supply and demand has caused UK dairy prices to fall, but the impact on our dairy farmers is far from uniform,” he said. “There is huge disparity between the top and bottom prices being paid under various milk supply contracts.”
He said this was making farmers’ type of contract one of the most important factors affecting profitability and while the firm was yet to see much land come on the market, some dairy farmers may have to consider this to reduce debt if the crisis continues.
Harrison and Hetherington’s Craig Brough underlined some of these themes. He said demand for land was likely to become very localised and while prices may fall in some regions, in others it would not.
Auctioneers from England, Scotland and Wales claimed there had very few dairy dispersal sales in recent months, although Glyn Lucas, auctioneer at Harrison and Hetherington suggested the number of dispersal sales could rise in the coming months.