ADAS dairy consultants have been working with farmers at the Stoneleigh Dairy Event at Livestock Show this week. The message is that dairy farmers need to take advantage of a predicted period of stability in the milk market to prepare for more volatility when EU quotas are removed in 2015.
The advice from ADAS is that many British farmers will be forced to make substantial investment in their dairy operations to remain competitive when the market regulation is relaxed by Brussels in 2015.
Carolyn Smith, a dairy consultant at ADAS said Organisation for Economic Co-operation and Development (OECD) forecast figures suggest milk prices are set to enter a period of rising stability after recent turbulence caused by fluctuations in the farm gate price, rising fertiliser and oil costs and a drop in demand.
She said: “Dairy farmers have had a tough time of it during the recession because their income has been falling while input costs have risen. However demand is expected to pick up, and that, coupled with EU measures like the recently introduced Private Storage Aid and the export fund scheme means British farmers can probably expect farm gate prices to stabilise in the medium term as supply and demand balances out.”
Ms Smith added that it was critical farmers took advantage of the anticipated rise in prices predicted for next year and consider upgrading their facilities to take account of new legislative requirements, opportunities to expand their operations and to improve technical and financial performance.
“There is not much recovery time and the window of opportunity will not be open for long so it important to begin to plan now. Those farmers who do decide to invest in their facilities need to consider exactly what lies ahead and how the money can be best spent improving their operations.”
To help dairy farmers consider the obstacles lying ahead, and assess individual farm requirements, ADAS’ dairy consultants can provide advice.
For more information, please contact Carolyn Smith by e-mail carolyn.smith@adas.co.uk or telephone 01267 220127.