I I A N P O T T E R A S S O C I I A T E S
1 5 t t h M a r r c h 2 0 1 3
Specialist Agricultural Quota & Entitlement Brokers
Telephone 01335 324594 Fax 01335 324584
Website www.ipaquotas.co.uk
Email sales@ipaquotas.co.uk
Issue No. 713
Today Last Week Change 4 Weeks Ago 1 Year ago
Clean 0.10ppl
AMPE 31.20ppl
MCVE 33.19ppl
Producers in E & W
10,681
0.10ppl
-
-
0.10ppl
31.20ppl
33.19ppl
10,688
0.15ppl
28.00ppl
32.24ppl
10,718
£ : $ £1.49
£ : € £1.16
Crude Oil £110
Wheat £200
Soya meal £388
£1.49
£1.15
£110
£203
£386
(Commodity and currency prices – source BOCM Pauls)
Milk Quota Available
-
+£0.01
-
£3
+£2
£1.55
£1.16
£117.50
£206
£367
£1.58
£1.20
£126
£170
£299
Litres Available
589,188
652,299
933,490
Butterfat %
3.89
3.92
3.97
Price
0.10ppl
0.10ppl
0.10ppl
Should you require any information or prices on available milk quota, please contact Jacquey@ipaquotas.co.uk
2013 Single Farm Payments Available
5.14 English Non SDA
30.50 English Non SDA
38.00 English Non SDA
23.14 English Non SDA
Offers
POA
POA
POA
Use by 2014
Use by 2014
Use by 2013/14
Use by 2014
Should you require any information or wish to make an offer, please contact
Single Farm Payment and Entitlement fears could cost farmers dearly marg@ipaquotas.co.uk
During the past week a couple of farmers have contacted the office asking us to sell their entitlements believing the SPS
2013 is the final year so they may as well cash them in.
Similarly several farmers without entitlements but with available land (naked acres) have commented it’s not worth buying them to only receive 1 years claim (2013).
Well the reality is that moves based on this analysis are almost certain to end in tears.
The regulation to claim SFP each year remains in place until it is repealed which effectively happens when a new Council
Regulation is published once the current reform process is agreed and completed. It is a near certainty that fairly soon a regulation will be approved for a 2014 claim year to set the financial ceilings, modulation etc.
If agreement was reached by the EU today it is estimated the RPA would require a minimum of 18 months to be ready to launch a new scheme and no doubt some other member states would require longer.
As every day passes it looks increasingly as if there will be a 2015 SPS claim which would mean three full claim years on entitlements acquired before 2 nd April 2013. Hence our reluctance to sell entitlements based on the analysis that 2013 will be the final claim.
1ppl milk price increase to Parkham Farms suppliers – from April 1 st
The 1ppl comes in the form of a monthly loyalty bonus paid on all litres and takes their milkprices.com standard litre price to 31.23ppl which milkprices.com states is “the highest milk price for cheese of any buyer we monitor”.
The firm has also increased its volume bonuses which start at +0.15ppl (3,000 litres/day average production) to 1.8ppl for
14,001 litres day.
Whilst competition from Muller Wiseman, Arla and others for milk from Parkhams catchment area is undoubtedly a key factor Ian believes the Tesco factor is also a huge influencer. The Irish Dairy Board (IDB) pack Parkhams Cheese and are
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

very much aligned to Tesco. So when Tesco pledge to source more British cheese the likes of Parkham and South
Caernarfon Creameries are expected to respond as key suppliers of British cheese to IDB. The only way to get a positive response from drenched and fed up producers is through the milk price.
Dairy Crest Gold Rush starts 10.00am Tuesday 19 th
Applications for the new Dairy Crest/Dairy Crest Direct formulae price contract open at 10.00am on Tuesday where non aligned producers can apply by email only for 25%, 50%, 75% or 100% of their milk to be sold on the formulae pricing.
(see last weeks bulletin for more detail).
In total only 100 million litres is available from April and the early indications are that this could be sold out in minutes with one farmer even drawing the similarity with Glastonbury Festival and England football ticket application windows.
Most producers will be requesting both delivery and read receipts to their emails as well as watching Greenwich meantime on the internet or pre-setting a timed email for 10am. Early arrivals will be binned so as always timing is critical!
We hope in next weeks bulletin we will be able to confirm whether there was a stampede of farmers battling for volume and if so by how much it was oversubscribed.
Note last week we omitted to state for those farmers who move on to the formula pricing contract they will continue to be under 12 months leaving notice and not the three months provided under the VCP.
Farmers For Action call on all retailers to clearly show country of origin labelling on all own brand cheese.
A simple but potentially very effective idea has been released by FFA this week requesting (or perhaps even demanding) that all retailers clearly show the country of origin on all cheese.
The bulls eye target for this is undoubtedly Tesco whose main GB cheese partner is Adams Foods (Irish Dairy Board).
Others are clearly partnered on own brand and value cheese to domestic processors for example Asda (First Milk),
Sainsburys (Arla/Milk Link) and Morrisons (First Milk) which leaves Tesco rather lonely and a target.
The FFA release states:
In view of the recent horse meat scandal, FFA Chairman David Handley is calling on all CEOs of the retail industry to clearly show country of origin on all purchased cheese.
The cheese market at the moment is in complete disarray. Cheese is being sucked in from all over the world and the consumer has no knowledge of its origin, or its production methods and for that reason it is imperative that country of origin is clearly shown on all these products.
A large amount of cheese that is coming into the UK currently being sold under supermarket own brand is not matching the standards required by British dairy farmers but yet is being used as a tool to drive down British milk prices. This has to change and if retailers mean what they say, following the latest food scandal, they should address this with utmost urgency.
If FFA do not see a change in this procedure by the end of March, we may well have to visit retailers to convince them otherwise.
Job losses at Lactalis Stranraer plant
It appears Lactalis are consulting over the axing of 17 jobs out of a total of around 100 employees. Whilst cutting costs is one driver another could be the fact Lactalis have recently found turning all their milk in to cheese is not as profitable as brokering it to others particularly some of our large liquid processors and this could be a long term move to make less cheese. Some retailers need to take note of the Lactalis move especially if they plan to buy more British (as in Great
Britain and not British Isles) produced cheese.
First Milk issue preference shares plus 3% return on capital
First Milks Wiseman share sale proceeds totalled close to £28million and the proceeds were divided between the acquisition of the CNP professional (May 2012), reducing working capital requirements and issuing preference shares to members.
The issue of the preference shares is considered a more tax efficient way to deal with the money compared to crediting the money to member capital accounts.
For those who have been long term members of the Co-op and are fully paid up they will receive around £8,000 for a fully paid up 1million litre producer on which for the next 5 years a fixe d 5% return (£400) will be paid. For the average First
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

Milk producer we calculate they will receive around £5,600 in shares which on a 5% return guarantees them £280/year for five years totalling £1400.
If a producer retires or leaves First Milk they can trade their shares with other producers. It remains to be seen whether the preference shares are worth the £8,000 (based on a 1 million litre produer) or worth more or less when they are traded. For those who hold on to the shares they should receive the 5% return for the next 5 years.
AFMP and Arla prepare to outline the road to full membership
AFMP and Arla have commenced detailed discussions as to how producers can become full members of Arla amba.
Once the road is defined and producers make their choice there will in reality be two groups of suppliers. One will be full members of the Arla amba Co-op and the other will be direct suppliers. Once details are agreed and producers have to make their choice it will be interesting to see whether any current AFMP members opt for a straight direct non membership contract as opposed to full membership.
FFA Co-ordinator claims farmer Co-ops are a disgrace (but means one Co-op)
FFA’s Northern Ireland Co-ordinator William Taylor has penned a controversial, and incredibly inaccurate, article for the latest European Milk Board March Newsletter.
In the article he lambasts United Dairy Farmers and its subsidiary Dale Farm for not insisting Muller Wiseman buy milk from the monthly auction, which stopped last month. Instead he states that Dale Farm agreed to “send whatever milk
Dale Farm Ltd can spare for the next 5/6 months until the Spring flush starts”.
The truth is Wisemans have never bought even a single load of liquid milk from Northern Ireland let alone have a relationship as suggested in the article.
Indeed given their customer base it seems inconceivable they would contemplate buying milk from outside of GB. Lesson is that the facts should have perhaps been checked with the former Wiseman Milk Partnership Chairman who is a strong supporter of EMB and its work before going Europe wide with the article.
New RABDF Chairman
Lancashire Pedigree Jersey farmer Ian Macalpine is the newly elected Chairman of RABDF and takes the reins from
David Cotton who has completed his three year term.
38,010 GB cows slaughtered in 2012 under TB
Defra figures indicate more than 38,000 cows were compulsorily slaughtered in 2012 an increase of 10% on 2011. Taking the total for the past three years to 105,800.
February milk production
Note last weeks bulletin compared February 2013 to February 2012’s milk production and did NOT factor in the leap year effect. When the leap year adjustment is made Februarys 2012 to 2013 production was down 4.2%.
Wanted
Naked acres (land over which no one is claiming SFP on in 2013) in the Shropshire, Staffordshire or Derbyshire area.
Small areas 1ha to a maximum of 16ha required within the week. Email details to marg@ipaquotas.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