IAN POTTER ASSOCIATES
25th May 2007
Specialist Agricultural Quota & Entitlement Brokers
Telephone 01335 324594 Fax 01335 324584 Ceefax BBC2 Page 249
Website www.ipaquotas.co.uk Email sales@ipaquotas.co.uk
243,338 3.72% 0.67ppk 2.50ppl
444,640 3.88% 0.67ppk 2.60ppl
Today
2.80ppl
Clean
0.25ppl
Lease
22.4ppl
AMPE
Last Week
2.90ppl
0.25ppl
Change
-0.10
-
550,000 4.06% 0.06ppk 0.25ppl
750,000 4.70% 0.06ppk 0.30ppl
4 Weeks Ago
Same Week 2006
2.30ppl
3.80ppl
0.25ppl
0.30ppl
19.9ppl
17.4ppl
Middle ground suicide sellers could wreck the UK market Preston and Bolton are the latest targets for the aggressive selling
tactics of Medina and Freshways where milk is being offered to shops at 65p for 2 litres by Medina and Freshways have offered one
shopkeeper 2 litres for a ridiculous 45p. One wholesaler has lost several long-standing clients and is not only worried for his own
business but also as to how long the major retailers and discounters will back paying farmers 22p (Tesco) and see corner shops
significantly undercutting them. These two cannot be allowed to jeopardize the entire UK liquid milk market. Those supplying milk to
the likes of Medina and Freshways will have to exert pressure on them and if they are locked into long term contracts at low prices,
perhaps the contract should be broken and compensation paid.
Dairy Crest profits up 68% to £64.6m Dairy Crest’s preliminary end of year financial highlights show profit, before tax, up 68%
from £38.4m to £64.6m and pre-tax profits of £80.5m. Meanwhile, Dairy Crest is concentrating the bulk of its budget for research into
developing healthy dairy products. Healthier lighter Utterly Butterly and Clover are due late 2007.
Torridge Vale increase producer milk price by 0.75ppl backdated to 1 st April The tidal wave of announcements confirming
milk price increases to producers seems to be never ending and Torridge Vale have given a back dated increase of 0.75ppl. This, we
believe, will be the final April back dated increase.
Arla milk price increase Arla’s organic suppliers will receive an extra 0.75ppl from 1 st May.
Charlie Payne signing up Cumbrian farmers Following up on a call received from a Cumbrian farmer, it seems the fierce
competition to sign up farmers in the Carlisle to Brough area is not over, especially now Charlie Payne is in town. Paynes already
collect from 6 farmers in the area and are keen to sign up more to accommodate future expansion. Given Charlie’s track record with
direct suppliers (see last week’s article) he is likely to successfully attract new suppliers.
No June Milk Price rise for Dairy Crest Suppliers That sums up the position which basically amounts to a refusal by Dairy
Crest to raise prices. However, on the basis most contracts are quarterly and currently under negotiation for a new term starting 1st
July, Dairy Crest will be under extreme pressure to sell at prices, which reflect significantly improved market conditions and pass on a
fair share of the gains to farmers in July.
House of Commons Milk Debate Tuesday morning saw the House debate the dairy industry. Credit was given to FFA and the
WI and its Great Milk Debate, with a comment “we ignore the WI at our peril”. Mention of the Tesco 22p was made but clearly MP’s
are aware of how Tesco operate, hence, a comment by the debates organiser, MP Mark Williams, “I sincerely hope that Tesco’s
direct supply contracts are robust enough to ensure those guaranteed prices actually reach farmers.” MP’s confirmed they were
frustrated to learn the Competition Commission would not announce its conclusions until February 2008. Full details log onto
www.parliament.uk
RPA still in a big mess The RPA has now fallen behind the £1.32 billion it had paid out by this time in 2006 of 1.322 billion
compared to the 1.274 billion paid by 23rd May.
BBC Food gets its calf export details wrong Log onto www.bbc.co.uk/food and look at the article “Is veal cruel?” and the
responses under “Have your say”, which numbered 66 within 24 hours. They talk about 3,000 calves a day being exported and
Compassion in World Farming (CIWF) fearing this figure will double to 6,000/day. If only that were remotely possible, quota would be
60p/litre+. Talk of calves in crates and cruel factory farming practices demonstrates both the BBC and CIWF are 10 years plus
behind the real facts.
First Milk paid almost £67.5m for Dairy Crest business Dairy Crest has confirmed it was paid £67.5m by First Milk and that
Dairy Crest paid First Milk £6.9m for its share in Haverfordwest leaving the nett amount which changed hands of £60.6m.
FFA’s David Handley acknowledges success of WI Milk Debate instigator On Wednesday in Exeter, David Handley, made
a presentation to Rhoda Lee, WI member for Devon, for her idea and efforts on the Great Milk Debate.
New DCD Chairman Ian Sharman will replace Richard Weaver as Chairman of the Dairy Crest Direct Board.
Several First Milk members unhappy with rule change handling E-mails received this week indicate some First Milk
members are very unhappy with how the co-op is “railroading” through a new set of rules on the 30th May. Dairy Farmers of Scotland
(DFOS) have also had calls and e-mails and is requesting members who are unhappy to contact them (doris.robertson@dfos.co.uk.)
One member who’s voting power benefits from one of the changes, described the proposal as “and earth moving change” which could
effectively “disenfranchise 80% of First Milk members with no hope of reversing the decision”. Another calculated this would
effectively put 50% of the votes with 20% of the membership. Several are questioning why the rush and lack of consultation and
“what do they have in the pipeline which is driving this and necessitating them not to properly consult members”. They believe the
timing at silage time with a Bank Holiday is deliberate and the idea directors vet prospective directors has been greeted as a
“communist version of democracy.” Age discrimination has been quoted as a reason they need to change the rules but most
members are not so naive as to not realise the age discrimination law came in before First Milk’s last AGM. However, it seems
inevitable the current rules will be replaced on Thursday despite representations.
Ian’s Diary
Monday 28th May:
Tuesday 29th May am:
Do not disturb: At Wembley for Derby Play offs. Come on you Rams!
Do not Disturb: either nurturing headache due to Derby win, or hiding from gloating
West Brom farmer fans. (If it has any?)
Wednesday 30th May am: Do not disturb: Cleaning database for Derby and West Brom fans and introducing
special "0% discount" quota deal for former if we win, or imposing unique 10,000% quota surcharge for
WBA fans if we lose.
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