Agribusiness News August 2024 – Milk

Milk production data

The latest GB monthly milk production data from AHDB is estimated at 1,042 m litres for June, just 3 m litres less than June 2023.  Daily deliveries were 32.92 mlitres for the w/e 20^th July, 1.3% below the previous week and 0.3% down on the same week last year.  The UK milk volume for June is estimated at 1,274mlitres, 7.5% less than the previous month and just 0.1% less than June 2023.

Farm-gate prices

The Defra average farm-gate milk price for June was 38.43ppl, 0.57ppl up on the May price and 6.5% higher than June last year.  Milk prices from the main Scottish milk buyers available at the time of writing are shown below.

Dairy commodities & market indicators

There was little movement in the latest UK wholesale prices for dairy commodities, with the exception of cream which rose on average by £230/t (10%) from the previous month.  The summer holiday period has subdued demand for most products although the main price driver for cream was falling milk volumes and the seasonally lower butterfat levels.  In addition to which, an export premium for cream meant little was available for butter production, further tightening butter stocks.  As a result, AMPE dropped marginally due to little change in the butter price and skim milk powder price falling.  However, MCVE rose 1.46ppl on the back of the rising cheddar and whey powder price components.  The Milk Market Value indicator was up 1.17ppl for July to 39.82ppl and is now 2.85ppl more than six months ago.

© AHDB [2024].  All rights reserved.

1^st cut silage quality

Reports on 1^st cut silage quality appear to be mixed but the trend is for slightly lower quality this year, given the mild winter and higher covers going into the spring.  Also, many silages were cut slightly later than normal, and a 1-week delay can reduce the D-value by 3.5 units, equivalent to ~0.6MJ/kg DM. Protein levels are slightly lower on the back of less fertiliser and slurry applied in late applications to avoid excess nitrogen in silage.  With 2^nd cut yields reported light with slow regrowth after 1^st cuts; it is worth carrying out a forage budget to ensure sufficient stocks for the coming winter.  For this you need to know the dry matter of all forages on the farm, the number of stock (lactating, dry cows, youngstock etc) and the amount of forage fed in each ration.  As always, it is important to use recent forage analysis to ensure that rations are as cost-efficient as possible, tailored to the desired production level and formulated to support overall health.

Kingshay annual costings report

Kingshay have released their annual costings report which compiles data on milk production, margin over purchased feed costs, health and fertility from over 1,100 dairy herds for the 12-month period up to March 2024.  The difference between the highest and lowest milk price was a massive 13ppl.  For Scottish herds averaging 9,314 litres, the total purchased feed cost was 13.42ppl, with a margin over purchased feeds of 24.38ppl (£2,270/cow), down 6.7% on the previous year.  From a fertility perspective, improvements were seen in fertility, with the 100-day in-calf rate up from 46% to 48% and conception rate up from 38% to 41%.  Positive news given that the cost penalty of extending the calving interval was calculated at £4.88 per day.  From a production perspective, while the system that returned the highest margin per cow of £2,495 was a housed all-year-round calving system;  the highest margin per litre  of 29ppl was achieved by autumn/split block calving herds focused on grazing.  This report is an excellent document with which to benchmark your own herd and can be found here:

https://www.kingshay.com/wp-content/uploads/Dairy-Costings-Focus-Report-2024.pdf

Lorna MacPherson, lorna.macpherson@sac.co.uk