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T
Mark Lee Norton and Brooksbank
he past few months have seen a
continuing shift in dairy cattle sales, both in terms of volume sold and their value. The higher milk prices of previous years together with many farmers desire for rapid expansion led to strong demand for large groups of milking cows and whole herds by private treaty. Many farmers looking to sell their cows were given a quick, cost effective and hassle free alternative to an auction sale.
“The current situation within the industry is a different picture. A combination of marginal incomes from milk, in
many cases, together with many milk buyers placing restrictions on increased production levels, have led to few enquiries for whole herds. That said, we sold three large herds privately in the run up to Christmas which was against the trend of much of late 2015.
“Despite many in the industry being understandably down beat, 2016 has started with a flurry of enquiries from people looking to buy groups of cows and young stock. Dairy cattle of all ages are still in short supply and there is a healthy demand for both TB and general herd
replacements. “It should be
remembered that many of today's large herds do not rear their own replacements and, all be it at less money, they still need to constantly buy cattle. On a more positive note, there are of course still a number of farms with better milk contracts and many of these guys are active in the market for better quality stock at an increased price. Already some people have half an eye on a possible upturn later this year and are looking to stock up while prices are depressed.
Sam Bradley CCM Auctions
testing road looks set for the short- term, with a brighter future somewhere on the horizon. The strength of the EU milk industry lies in its skilled farmers, infrastructure, agro- technology and climatic conditions, which puts us ahead of large parts of the world, with resilience to this downturn key to maintaining the sector’s place in the international market.
A
“Into 2016, commodity price is only likely to recover slowly, with poor weather conditions in New Zealand likely to favour this. However, everyone is aware that it takes two to three months for this to affect the raw
milk price.
“Over the next three to four years, the average UK milk price is predicted to vary between 26p/ kg to 28p/kg. Having said that, feed and fuel costs are set to be lower through the same term and will hopefully improve margins within the sector (EU, 2015).
“Throughout 2015, newly calved heifer and cow prices have reflected the difficulties faced in the dairy industry, with last year’s averages through the ring being understandably lower than previously. “However, the quality has been just as good, if not better. Despite prices being in line with
industry trends, regular and seasonal purchasers have still been attending the twice monthly sales to bid on and buy the quality milkers on sale. “It was clear to see throughout 2015 that purchasers have searched for value for money, with animals being built to last high on the agenda. Also, a national trend throughout the year saw farmers quick to cull problem cows to reduce variable costs, with the intention of regenerating their herds through the auction ring and/or home-grown replacements to try to improve their cost of production.
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