IAN POTTER ASSOCIATES
15th February 2008
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
Clean
Lease
AMPE
MCVE
Producers
in E & W
Today
1.00ppl
0.10ppl
27.00ppl
28.85ppl
12,514
Last Week
1.00ppl
0.10ppl
Change
-
-
-697 in 12 months
4 Weeks Ago
1.30ppl
0.10ppl
28.00ppl
28.84ppl
12,561
Same Week 2007
1.60ppl
0.10ppl
18.50ppl
20.13ppl
13,211
12 month average
2.02
0.14
27.70
26.80
12,794
European dairy farmers unite to reject proposed quota increases The European Milk Board (EMB) held its first Congress in
Brussels on Wednesday, with 4,500 dairy farmers from across Europe in attendance out of a total membership/following of 80,000
dairy farmers. The message was clear, insofar as, dairy farmers are prepared to stand together to achieve a fair price, whic h covers
the real cost of production and leaves a realistic profit. The gathering was closely watched by the European Commission who
attended and in his opening speech the President of the EMB, Mr Schaber, rejected the Commission’s proposed quota increase an d
the abolition of quotas in 2015. At the Congress, 14 model cows called the Faironikas, representing one cow from each member
country of EMB plus a European one were presented to the European Commission representative. The idea was to remind officials
the significant role dairy farmers and their cows have in society.
OFT gets its knuckles wrapped A high court judge has slammed the Office of Fair Trading today for engaging in "public relations
exercises" over its milk inquiry, which led to record multi-million fines from several dairy companies and retailers. He also accused the
regulator of trying to attract "sensationalist publicity". The Daily Telegraph said, the comments are likely to "heighten concerns about
the aggressive and high profile tactics adopted by the OFT since the appointment of John Fingleton at the end of 2005". Fines from
the organisation increased 76 fold last year to £237m. Many of the dairy companies pleaded guilty to the alleged offences in return for
far lower fines and to get the OFT off their backs. Lactalis McClelland settled its differences with the OFT today, also admitting "guilt"
and paying an undisclosed fine, but Tesco and Morrisons are still fighting, however, with the latter suing for libel. The news comes
2 weeks after the OFT launched it’s "Scam Awareness Month", with the organisation raising awareness of scams, which cost the UK
£3.5billion a year. Well fancy that!
Morrisons to take the OFT to court Morrisons is to take legal action against the OFT for naming Morrisons as being involved in the
retailer milk cartel. Morrisons has accused the OFT of damaging its reputation. In December, ASDA and Sainsburys did a deal with
the OFT to co-operate in return for a reduced fine, however, Tesco are also set to challenge the OFT on its involvement and any fine.
Lactalis settle with OFT Meanwhile, Lactalis have reached a settlement with the OFT for its involvement in any price fixing, which
was under the name of A McClelland & Son prior to the French acquisition.
NFU England & Wales and Scotland and Ulster Farmers Union call for the ending of quotas but the need for future protection
The 3 unions have issued a collective policy statement concerning the future direction of the EU dairy regime in particular m ilk quotas.
They favour the ending of milk quotas in 2015 and phased milk quota increases. The really interesting point is that they agree that
serious work needs to be done to ensure post 2015 dairy farmers’ interests can be protected from abusive power of milk buyers in a
non-quota world. The statement suggests the problem warrants the Commission to examine how to guarantee some protection for
dairy farmers through rules on milk contracts. Contrast this to the EMB position that such abuse cannot realistically be insured against
in a non-quota world. All seem to agree that life after quotas will be no easier and certainly challenging.
Tesco calf scheme gets off to a shaky start One of the more challenging conditions set by Tesco for its dairy farmers was the ban
on both Tesco core and balancing producers selling calves for export. Tesco declared that it would start to collect calves ex-farm from
1st February for its St Merryn Calfgold Intergrated Beef Scheme but the first collections were delayed until late this week and were
limited (40 “Choice” calves as a trial run to Meatgold). One problem is without doubt the ill conceived calf pricing grid on which many
Tesco suppliers believe calves they hope will be collected next week will attract a payment of between £60-£70 with prices increasing
by £10 head per week. One farmer claims to have 30 calves on farm and anticipates a juicy cheque. Our belief is this grid i s
impossible to work and someone is in for a dose of medicine. Whilst Tesco may be able to claim the scheme has started and ma y
wish to claim good PR it is miles away from being able to declare thatthe bulk of the male calves from Tesco producers are kept alive
and fed in the UK. In true Tesco style they are passing over all the risk without giving any price guarantees to the likes of Meatgold.
It’s a case of Tesco saying you buy calves at our price, you feed them and Tesco will do their best when the animal is finish ed. This is
not a Tesco alternative to calf exports it’s just a case of them organising collection points and for those who are not happy with the
Tesco calf price there are already ways around the problem.
DEFRA December average farm gate milk price 26.61ppl - up 8ppl on December 2006
Dairy Crest share buy up Top brass at Dairy Crest simultaneously waded into the stock market on Tuesday to bag more than
£100,000 of Dairy crest shares, including Chairman, Simon Oliver, who acquired 5,000 shares taking his holding to 45,000 shar es.
Other purchasers included 3 of Dairy Crest’s board members.
Wisemans announce zero waste will go to landfill Wisemans Dairies are on target to re-cycle 100% of the waste from its dairies
and distribution depots by the end of 2008, resulting in no waste going to landfill.
Cull cow market marches towards £2.00/kg The cull cow market continues to march onwards and upwards with our price for best
cows weighing in at £1.80/kg with recent weekly rises going in 10p jumps as opposed to the normal 1p/kg multiple movements.
Milk production in New Zealand is crashing in driest January for more than 100 years The high temperatures in New Zealand, in
particular the dairy region of Waikato, are hitting milk production hard, with latest figures showing this regions daily milk production is
down 27%. The Waikato region has seen less than 8mm of rain in January, making January 2008 the driest on record since they
started recording in 1906.
Ian’s Diary
Monday & Tuesday (18th & 19th)
NFU AGM London
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