Milk Price Tracker
- Thread starter rc mx110
- Start date
Only
Member
- Location
- Powys/Shropshire border
how much is the drop
early riser
Member
- Location
- Up North
0.84ppl from 25 May
Within 20 miles of me there are a handful of FM producers, none of the very few I know are talking of quitting.As far as I know they are all on less than 20ppl paid into the bank.This suggests to me that the milk price for most GB producers could decrease further before GB production starts to fall.MDC on their website suggest that the USA are expected to expand production in the next 2 years and anecdotal evidence points to increased milk production in China.The strength of the pound puts the UK at a competitive disadvantage to the eurozone and this does not look as though it will improve.All of which indicates the prospect of substantial price increases in the medium term are very poor.
I have never felt as gloomy about the short to medium term future profitability of milk production in the North of England and Scotland which do not have the climatic advantages of the South West.
I have never felt as gloomy about the short to medium term future profitability of milk production in the North of England and Scotland which do not have the climatic advantages of the South West.
Last edited:
cornishfarmer
Member
Fob please confirm. Surely Arla ate taking the p:-/s out of the British farmers.
March price rise 1.5€ cent= 0.83ppl
May price reduction 1€ cent = 0.84ppl
Come on who is representing us. Have they lost their calculators we just being used as whipping boys. Fair is fair we are all equal in a coop unless we are British
March price rise 1.5€ cent= 0.83ppl
May price reduction 1€ cent = 0.84ppl
Come on who is representing us. Have they lost their calculators we just being used as whipping boys. Fair is fair we are all equal in a coop unless we are British
More to life
Member
- Location
- Somerset
Paddler I think that's on the money ,to press like seemed inappropriate
happycows
Member
- Location
- North Devon Cornwall border
people are not selling up in any more numbers than any other normal year. Monthly Dairy sale last week had less than 40 in milk cows and prices firming a little. Few herds retiring from dairy but for every one giving up I can name another just started/starting.
how these poor beggars on less than 20ppl manage I just don't know. I can only assume it will take them years to pay off some of the shortfalls that are accumulating.
how these poor beggars on less than 20ppl manage I just don't know. I can only assume it will take them years to pay off some of the shortfalls that are accumulating.
farmer on a bike
Member
In March there was a currency correction as well of about -0.4ppl . At the start of July there will be another currency correction due of around -0.5 ppl at current exchange rate.
In fact actually you have the situation the wrong way around. If we had to accept today's exchange rate our price would be 2ppl lower, the currency smoothing mechanism is protecting us, because we use the average over the last 2 years, changing on a rolling quarterly basis.
You should feel sympathy for the Swedish Arla owners who are in the exact opposite position. There currency has fallen more than the Euro and they are on the wrong end of the smoothing as they are getting 2ppl below today's currency conversion. That means they are 4ppl below us if you convert on today's currency conversion which is extremely painful.
I
Chips
Member
- Location
- Shropshire
Was talking to one of the arla Farmer reps today at our local show , and he said there would be about 1.5p to come off this year yet for currency and similar next year if the exchange stays the same !
farmer on a bike
Member
Currently it looks like about 0.5 on 1 July, 1Oct, 1Dec, but because on each change there is less paid to the UK then there is more in the total pot so the milk price in € tends to increase slightly so the fall tends to be slightly less for example in April when the expected -0.5ppl became -0.4ppl. However I admit there is a possibility that will not happen as Sweden is moving in the opposite direction.
But this all relies on the exchange rate staying as it is now. I think the one certainty is that will not happen and I believe the £ is more likely to weaken from its current strong position than to strengthen further but I could be wrong, time will tell
But this all relies on the exchange rate staying as it is now. I think the one certainty is that will not happen and I believe the £ is more likely to weaken from its current strong position than to strengthen further but I could be wrong, time will tell
Only
Member
- Location
- Powys/Shropshire border
why do you think the £ will weaken?
farmer on a bike
Member
This is almost as strong as we have ever been against the € and although Greece is a big issue many of the other € countries are doing OK particularly in Northern Europe. If Greece finally defaults it will remove uncertainty which will strengthen €. In the UK we are likely to have uncertainty around the EU referendum which may weaken £.
I may well be wrong and I'm sure I could argue why the £ could get even stronger, but in my life time the £ has many ups and downs and one usually follows the other, we seem to be on an up ( maybe not yet at the top) but it will be followed by a down at some point.
I was really trying to point out that just because something is so today, there is no certainty it will be so in a month or a year or even tomorrow, when looking at currency or come to that in the milk market.
I may well be wrong and I'm sure I could argue why the £ could get even stronger, but in my life time the £ has many ups and downs and one usually follows the other, we seem to be on an up ( maybe not yet at the top) but it will be followed by a down at some point.
I was really trying to point out that just because something is so today, there is no certainty it will be so in a month or a year or even tomorrow, when looking at currency or come to that in the milk market.
buffalo_soldier
Member
- Location
- cumbria
Wont some of these price cuts be inevitable though? as they will already be factored in due to the currency smoothing system.
Say if the Euro rallies now, there will be a delay before UK producers will see the full benefit.
farmer on a bike
Member
The exchange rate for Q2 2013 was 8.76 to £1. If Q2 2015 was the same there would be no change. That will not happen as we are 2/3 the way through that quarter and so far it has varied between 10.1 and 10.5 and looks on course to average at least 10.3.
The effect on the conversion of our milk price is effectively an 1/8 of the difference between the 2 figures 8.76 and 10.3 because it is an average of the last 8Qs. The next Q to come our is October is Q3 2013 when exchange rate was 8.73 so if exchange rate stays as it is then the effect will be very similar but if some thing changes the dynamic and the rate fell back to 8.73 there would be no change, anywhere in between and the effect is less reduction than expected ( and anywhere higher and the effect is more than expected)
- Location
- South Molton
So it doesn't matter whether the UK cuts production, its the currency fluctuations that will affect the milk price for Arla members.
Would be interesting to see what %effect is has compared to the %exported?
Would be interesting to see what %effect is has compared to the %exported?
farmer on a bike
Member
Milk price is determined by currency fluctuation plus the performance of Arla as a whole, and milk supply will have some impact in that. The issue is world production vs world consumption so the impact of the UK alone is very limited.
I don't get the meaning of your second sentence so can't comment.
More to life
Member
- Location
- Somerset
I'm not so surprised by the milk price drop nz will always get worst and best of world market swings . It was news to me that you boys are ripping out trees to milk cows,no wonder there is to much milk about or it could be said that you must be runing out of ground to convert to move to such extreme measures .