Dairy Industry News and Features

Our Weekly News Bulletin is available by email. To receive it please email info@ipmsltd.co.uk.

Note, all standard litre prices are those quoted by www.milkprices.com and are based on the following:
The liquid standard litre 4% bf, 3.3% protein, 30,000/ml Bactoscans, 200,000/ml SCC, 1 million litres a year on EODC but before seasonality, monthly profile payments, balancing, B price additions, capital retentions or annual incentive schemes. The manufacturing standard litre is to exactly the same specification with the exception of 4.2%bf and 3.4% protein.

Remember this bulletin continues to be available free of charge and takes Ian & the team considerable time to produce. The only encouragement to keep producing it is a combination of enthusiasm, tag sales & enquiries from our readers.  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 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 any liability for any errors or omissions.  Professional advice must always be taken before any decision is reached.  For our privacy policy please click here.

Surprise 1.5 Euro Cents (1.4/1.3ppl) April Milk Price Increase for Arla Members takes them to Over 30ppl

Ian cannot recall an April milk price increase of this magnitude which is some achievement and clearly indicates for Arla the market has turned north.  The increase will be paid to both Arla’s Conventional and Organic suppliers and results in the following www.milkprices.com standard litre prices.  The dynamics of the increase are identical to the GDT surge in prices namely; strong demand for dairy from China in addition to increasing cream and butter prices, plus lower EU Milk output.

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Saphir Faces a Crisis as he is nicknamed the AHDB Undertaker

The good ship AHDB is in turmoil and looking like it could be heading for the rocks under the captaincy of Nicholas Saphir as it records its second NO vote from another levy paying sector. The latest blow, which was no surprise, is that 66.4% of the 1196 potato growers who voted said no to the continuation of the levy. This comes only a month after an overwhelming 61% of voting Horticulture levy payers said No.

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Jane King CEO AHDB jumps ship 6 months early

Another fact worthy of an explanation is how come in October 2020 AHDB announced that Jane King would step down as CEO after a six-year spell at the end of September 2021 having served 12 months’ notice. It turns out she leaves next week on March 31st, 6 months early! Was Jane given the push or has she joined others, like Tom Hind (formerly Tesco Tom) who left last September and was one of the first to hit the exit button.

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Arla Set to Close its North Cornwall Soft Cheese Factory

Arla has announced it has commenced consultation with 37 staff at its Trevarrian soft cheese factory, which is supplied with milk from eight local Arla Members.  The creamery is on the North Cornish Coast between Padstow and Newquay and produces Cornish Brie’s and Camembert’s. The Cornish County Larder based soft cheese business started life in 1996.  In January 2011, under the direction of CEO Neil Kennedy, Milk Link purchased the creamery before a year later it was transferred to Arla as part of the “merger” in 2012.

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1ppl Milk Price Increase for Members of Northern Ireland Co-op Dale Farm

This is effectively a backdated price increase covering deliveries made in January and takes members liquid standard litre price to a healthy 28.59ppl and according to www.milkprices.com compares to 26.09ppl in January 2020 so a 2.5ppl (9.6%) rise year on year.  For its Kendal farmer suppliers, the January price remains at 27.64ppl based on a liquid standard litre.

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0.6ppl Milk Price Increase for M&S Farmer Suppliers – from April 1st

This takes producers standard liquid litre milk price to 33.11ppl.   

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0.25ppl Milk Price Increase for Arla Direct Suppliers (Non Members) – from April 1st

The increase applies to Arla’s conventional and organic direct suppliers. This takes producers conventional standard litre milk price to 27.58ppl and based on a liquid litre 26.5ppl.    

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Fonterra Increases its Farmgate Milk Price Forecast to almost 30ppl for the second Consecutive Month

Hot on the heels of the latest sensational GDT Auction result came on announcement from the New Zealand giant of a further increase in its forecast farmgate milk price.  The latest increase takes the mid-point price up from NZ $7.20 (28.52ppl) to $7.60 (29.77ppl) with the range spanning from NZ $7.30 (28.6ppl) to $7.90 (30.95ppl).   

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Arla's 13th Payment of 1.576ppl (1.75 Euro Cents/Kg) is confirmed

As expected, Arla’s Board of Representatives gave the thumbs up to the Arla Directors recommendation of an increased 13th Payment from 1 euro cent to 1.75 euro cents. This means that the payment based on the www.milkprices.com standard manufacturing litre equates to 1.576ppl for the 2020 calendar year and based on a liquid standard litre it equates to 1.519ppl.

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Milk Price Changes

The only milk processors whose last farmgate price move was down are as follows; County Milk Products, Paynes, Freshways, Medina and Pensworth. If you know others we have omitted, please email Ianpotter@ipmsltd.co.uk.  Note there have been no reductions from any mainland GB cheese makers who buy milk direct. 

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The Dairy Market Outlook

The short and medium term outlook is now more positive for all processors and whilst further price reductions from milk brokers and some middle ground liquid processers cannot completely be ruled out, any who do announce further cuts must surely be challenged as going against the facts and general direction, especially any who are brave enough to suggest any April farmgate price adjustments.

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£12.5m Investment Commitment in Cheese Processing by First Milk

The investment will be split between the Co-ops two cheese factories with £9m targeted at its Haverfordwest facility and £3.5m at its Aspatria factory. The combined investment will boost processing capacity by more than 20% at both sites.  This latest announcement takes the total capital expenditure to circa £30 million in only 3 years.   

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