IAN POTTER ASSOCIATES
30th November 2012
Specialist Agricultural Quota & Entitlement Brokers
Telephone 01335 324594 Fax 01335 324584
Website www.ipaquotas.co.uk Email sales@ipaquotas.co.uk
Today
Clean
AMPE
MCVE
Producers
in E & W
0.10ppl
32.00ppl
32.41ppl
10,688
£:$
£:€
Crude Oil
Wheat
Soya meal
£1.60
£1.23
£110
£223
£383
Last Week
Change
0.10ppl
-
£1.59
£1.24
£110
£217
£375
Issue No. 699
4 Weeks Ago
1 Year ago
-
0.10ppl
31.00ppl
32.26ppl
10,704
0.30ppl
31.10ppl
32.68ppl
10,767
£1
-£1
+£6
+£8
£1.61
£1.25
£109
£217
£397
£1.55
£1.17
£106
£145
£251
(Commodity and currency prices – source BOCM Pauls)
Milk Quota Available
Litres Available
Butterfat %
Price
511,632
3.73
0.10ppl
410,472
3.98
0.10ppl
526,478
4.14
0.10ppl
Should you require any information or prices on available milk quota, please contact Jacquey@ipaquotas.co.uk
1ppl milk price increase for Paynes Dairies suppliers – From 10th December
0.5ppl milk price increase for all First Milk members and suppliers
Co-op First Milk has announced their December and January ex-farm gate milk price increases, thereby completing the
big four GB milk buyers’ winter milk price rises.
It’s effectively a 0.5ppl across all contracts, as follows:
0.5ppl from 1st December for all liquid contracted producers, which takes their standard litre price to 29.15ppl
0.5ppl from 1st January for all cheese contracted producers, which takes their standard litre price to 28.5ppl
0.5ppl to all balancing producers, split 0.25ppl from both 1st December and 1st January, which takes their standard litre
price to 28.5ppl
Note, 0.5ppl of all First Milk’s standard litre price is a volume payment conditional on each farmer producing more milk
than the farm produced in the same month a year ago. This is a huge hurdle for most farmers given the fact national
production has plummeted compared to a year ago.
1ppl milk price increase for Belton Cheese suppliers – From 1st January
This takes Belton’s standard litre price to 29.05ppl, which equates to 30.33ppl on a manufacturing standard litre.
5ppl price increase from Milk Link Processing Limited’s Crediton Dairy – From 1st December
Exclusively attributed to the need to raise prices to supplying farmers. The plant supplies UHT milk.
Dairy Crest price increases are confirmed
The DC price increases of 1.25ppl (cheese) and 1ppl (liquid), which were unconfirmed in last week’s bulletin were
confirmed by DC on Saturday morning.
2,500 protesting dairy farmers hit Brussels
This Monday and Tuesday saw close to 2,500 angry dairy farmers and 1,000 tractors join a European Milk Board
demonstration. The farmers camped out in a giant marquee erected in front of the European Parliament building. Their
protest is for the European decision makers to implement “flexible supply management through a European Monitoring
Agency”. In other words for milk quotas to continue. Farmers used fire hoses to spray milk at the Parliament’s buildings.
Average DEFRA UK milk price for October 29.06ppl
All views expressed in this bulletin are those of Ian Potter Associates and a shed load of dairy farmers. It is necessarily short and cannot deal with the various
issues that arise in any detail. As a result it must not be relied on as giving sufficient advice in any specific case. Every effort has been made to ensure the
accuracy of the content but neither Ian Potter Associates nor Ian Potter personally can accept liability for any errors or omissions. Professional advice must always
be taken before any decision is reached
This is only 0.03ppl below the October 2011 average price of 29.09ppl.
What are you all moaning about since you’re making “serious money”?
What are all you dairy farmers kicking-up a fuss about on milk prices? After all, you’re making a heap of money, according
to one consultant.
According to a report in The Scottish Farmer, entitled “Dairy Farmers can make serious money”, and in the Farmers
Guardian “There is money in dairying”, Derek Gardner of Promar (shortlisted Farmers Weekly Consultant of the Year
finalist, remember, and Tesco Cost of Production guru) made this bold (inflammatory?) statement at the recent Genus
Farming for the Future Conference:
“While feed bills have increased 44% over the past year, and are likely to remain high until the next harvest, next autumn,
the top 25% of dairy farmers are achieving profit margins of £949 per cow or 11.2p per litre. This compares to the
average of £548 per cow or 6.7p per litre.
According to the Promar figures, the average specialist dairy farmer with 200 cows, produces yields of 8141litres with
bought in feed costs working out at £717 per cow with forage costs of £109 per cow to give an operating profit of £548 per
cow or 6.7p per litre. This figure has been worked out before subsidy income, rent, finance and depreciation expenses.
In contrast, the top 25% of producers by milk sales per litre per cow had 230 cows yielding 9602litres with bought in feed
and forage costs working out at £894 and £116 respectively giving an operating profit of £670 per cow or 7.0p per litre.
And, the top 25% by profit per cow milked 184 cows yielding 8500litres with bought in feed and forage costs of £674 and
£101 per cow respectively, giving an operating profit of £949 per cow or 11.2p per litre.”
The Scottish paper commented: “Despite the huge increase in feed prices, dairy farmers can make money, and 'serious'
money, milking cows if they pay more attention to the feeds and actual price of feeds used.”
So there you have it. Forget milk prices. Forget the weather. Pay more attention to your feed prices! Ian wonders what the
buyers and the retailers (and consumers if they see them) will make of these headlines and comments. They won’t
exactly help to lift the milk price now will they!
For the full story click on the link http://www.thescottishfarmer.co.uk/livestock/trendsprices/dairy-farmers-can-makeserious-money.19484061
Kite Consulting say 32ppl is needed to break even and that’s the target for DCD
Whilst Derek Gardner was trumpeting how dairy farmers can make “serious money” John Allen and his team from Kite
have informed Dairy Crest Direct (DCD) that their ongoing monitoring of dairy farming cost of production is now showing a
break even price of 32ppl. Hence DCD’s New Year target price is for dairy farmer members to be paid at least the break
even price of 32ppl across both liquid and cheese contracts.
Tesco butter deal worth £16 million to Irish Dairy Board (IDB)
Irish butter will be supplied to Tesco stores across Europe following a £20 million contract the retailer has concluded with
the IDB. The butter will be produced in Ireland and packed in Germany. Currently Irish food exports to Tesco amount to
more than £562m/year.
Irish UK Cheddar exports up 12%
Figures released confirm that in the 12 months to 1 st October, UK imports of Irish Cheddar were up 12% to 59,300
tonnes. A whopping 323,000 tonnes of cheese (representing over 3.0 billion litres and equates to 83% of the UK’s total
annual cheese production of 391,000 tonnes) were imported in to the UK during the first 9 months of 2012.
Tim Farron MP cocks up on dairy once again
Westmorland and Lonsdale MP and President of the Liberal Democrats Tim Farron is no stranger to getting his facts
horribly wrong when he suddenly decides to comment on dairy industry issues.
Remember the gaff he made in March 2009 when he issued a press release declaring that DFOB were heading for
receivership “within days” in late March 2009, more than 10 weeks before it happened. At the time many assumed he
was Mystic Meg.
Well this week he and his communications department have firmly put themselves into the final of the 2012 Worst
Researched Dairy Press article. On Tuesday he delivered a 1,000 strong signed petition to No. 10 calling for a fair deal
for dairy farmers.
The gaffs made were as follows:
All views expressed in this bulletin are those of Ian Potter Associates and a shed load of dairy farmers. It is necessarily short and cannot deal with the various
issues that arise in any detail. As a result it must not be relied on as giving sufficient advice in any specific case. Every effort has been made to ensure the
accuracy of the content but neither Ian Potter Associates nor Ian Potter personally can accept liability for any errors or omissions. Professional advice must always
be taken before any decision is reached
1. He said dairy farmers currently still lose around 5p on every pint they produce (or 2.84ppl). We believe he
confused his pints with his litres and meant to say they lose 5 pence per litre.
He continued to confuse pints and litres stating the cost of production is 30p per pint. Even if we accept this error
and convert his pints to litres he talks about a cost of production of 30ppl and farmers receiving 25ppl hence the
5p gap. Come on, no one is paying remotely close to 25p anywhere in the UK let alone in your area.
2. He then referred to GB’s two largest liquid milk purchasers as “Robert Wiseman” and “Arla Muller”. Perhaps his
crystal ball anticipates a three way merger!
3. There was no reference to First Milk, who are the dominant milk purchaser in his constituency.
We think perhaps his best policy is to keep quiet if he doesn’t know his dairying facts, or at least have them checked out
before they are released.
BBC Food & Farming Awards Farmer of the Year
On Wednesday Ian had a day out to join the audience at the NEC to hear the winners of the BBC Food & Farming
Awards.
His hopes of seeing dairy farmer Tom Rawson from Dewsbury clinch the Farmer of the Year Award were dented when
Guy Watson of Riverford Organics was crowned 2012 winner. Tom did make it to the final three, which in itself is a
fantastic achievement.
SEMEX Conference January 2013
If you fancy having a debate with the Muller-Wiseman boss Ronald Kers, or hearing first hand from the top brass at the
European Milk Board, and chewing the dairying cud with a dozen or so other speakers and a large herd of dairy farmers
then make your way to the Semex dairy conference between the 13th and 15th January 2013 at the Radisson Blu Hotel in
Glasgow. Ian will be there and looks forward to locking horns in some juicy debate.
The conference has the title “Embracing change”; will be chaired by the current chairman of Holstein UK John Edge, and
also has as speakers Peter Kendall, NFU; Catherine Lascurettes, of the Irish Farmers Association; Alex Bandini, a retail
specialist at Kantar; Amanda Ball at DairyCo, plus some of the UK’s leading light commercial dairy farmers. There’s also
the excellent Scottish Semex Burns night supper to enjoy. Travel to the event is easy - Glasgow's main railway station is
right opposite the hotel and there’s a free minibus from the airport. The cost of the two-night package, including all meals,
is £375 plus VAT.
To book call Helen Miller, Semex on (01292) 671525 or email helenm@semex.co.uk
All views expressed in this bulletin are those of Ian Potter Associates and a shed load of dairy farmers. It is necessarily short and cannot deal with the various
issues that arise in any detail. As a result it must not be relied on as giving sufficient advice in any specific case. Every effort has been made to ensure the
accuracy of the content but neither Ian Potter Associates nor Ian Potter personally can accept liability for any errors or omissions. Professional advice must always
be taken before any decision is reached