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Regional link between dairy sales and milk contracts

With a mix of herd dispersals, increased sales of newly-calved dairy cattle and higher cull numbers in some areas, it might be thought the national dairy herd had shrunk.

 

While producer numbers have decreased, experts said those who remained were mopping up the productive cows being sold. The latest figures available from AHDB Dairy have not reflected any big increases in culls.

 

However, a regional picture of cull or newly-calved dairy sales has emerged, attributed by some to the availability of retailer-aligned milk contracts in particular areas.

 

Cull cow numbers going through the weekly ring at Borderway, Carlisle, soared to around the 600-head mark this winter.

 

Harrison and Hetherington’s Glyn Lucas said he was sure it reflected the absence of major processors and hence aligned contracts.

 

“Cumbria is a big milk field and urgently needs big-name processing and good contracts,” said Mr Lucas.

 

He said there had been no big increase in the number of herd dispersals as such, but those quitting the industry were tending to cull hard and realise maximum value, by selling productive animals as they calved through the dairy ring.

 

Richard Turner and Son auctioneer at Gisburn, Fred Spurgeon, said his market seemed to be ‘on the edge’ of the more northerly trend to quit.

 

“What we are definitely seeing is an apparent decision among dairymen to stop producing B-quota litres and we have seen some young dairy cows through the cull ring for no obvious reason other than that.

 

“We have also had a good number of dispersals, some of them gradually and quietly through the weekly dairy sales, although not necessarily all on the back of poor milk prices.”

 

At Beeston Castle auction in Cheshire, which stages what is claimed to be the largest monthly collective dairy sale in the country, more than 4,000-head of dairy cattle, including dispersals, have come under the Wright Marshall hammer this year – almost 100 per cent more than the same period last year.

 

Although director and auctioneer Clive Norbury said the firm currently had no dispersals booked in beyond June, he said ‘the situation is bad’.

 

“We are now in the second month of seasonality payments. It is always the case in farming that there is a delay between an impact on cashflow and the subsequent action which is taken,” he added.

 

“Currently, I would not describe dairy sales volume as a deluge, but it is difficult to predict what will happen, as many have already exited the industry and many more are virtually committed to sticking with it.”

 

Some 80 per cent of the 300 or so culls going through Market Drayton’s Monday evening market are dairy-bred. However, numbers are little changed from a year ago.

 

Auctioneer Bernie Hutchinson said he felt milk producers had been ‘on top’ of their replacement plans for some time, taking advantage of what had been, barring the odd blip, a firm cull cow trade and which was currently, significantly ahead of the prime cattle trade pro-rata.

 

Many of the herd dispersals handled by Leek, Staffordshire auctioneer Meg Eliot in recent weeks have been driven by unsustainable price cuts by one processor, and in some cases, ‘tipping the balance’ in combination with other factors. She said those selling up in one go, were often influenced by a clear TB test.

 


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  • 9,586 England and Wales producers beginning of April 2016
  • 281 down on same month 2015
  • Cow numbers up 54,000 in the year to 1.895 million
  • Overall, national dairy herd rose 65,000 (3.6 per cent) in last five years
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