Joined in 2023 
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63 About this deal
Our current projections for domestic demand expect retail sales of cheese, butter and yoghurt to fall by around 3% in 2023. Liquid milk sales are expected to revert to the long-term trend of a 1% annual decline (see full analysis below).
Even with the promised cap in energy prices, many businesses will see a doubling in the cost of red diesel and a trebling for electricity. A much greater understanding of energy consumption on dairy farms will be key. Fun fact: These diaries have removable PVC covers that keep them in perfect condition all year round. You can pop any A6 notebook or diary inside the cover once you finish.The company believes these trends will continue, although yield increases may slow significantly, resulting in a small decline in UK output. The latest outlook for EU productionis for deliveries to increase 0.3% due to increased yields. They also expect growth in exports due to a competitive price point. Savour this collection of sumptuous recipes that champions British ingredients and reflects the influence of the seasons. Better milk price is likely to largely offset rampant ag inflation – margins will remain strong, but down on 2021-22 Nevertheless, there will be good opportunities for those who see a long-term future in the industry.
Before this, GB production had been running below year-ago figures since July 2021, although the year on year growth recorded in March through June was more to do with the sharp enforced reductions in the spring of 2020. An unfavourable milk-to-feed-price ratio, driven by rising feed costs and stagnant farmgate prices, was the key driver of lower yields in the autumn of 2021, although labour shortages will also have played a role. Margin pressures then worsened as global energy prices spiked, with the situation exacerbated by the outbreak of the war in Ukraine. The increase in milk prices through 2022 helped to offset the rising costs and supported improved yields in the final months of the year. Robotic milking is being looked at by many, but in most cases this will increase the cost of milk production. Interestingly, the milk price has increased tenfold since 1973 and is roughly the same in real terms, according to the Bank of England’s inflation calculator, but its value as a percentage of the retail price has reduced from 50% to just 42% today.Despite the recent upturn, total production across the key regions in the year to date (Jan-Nov22 [2]) was 0.5% lower than the previous year. Early forecasts for 2023 suggest no growth, although that varies by region. Higher production in the US (+1%) will be offset by reductions in most regions with the exception of a small gain in the UK (+0.3%) and unchanged production in Australia. Shop Papierniczeni diaries here. Please note these diaries have been selling out fast, the below colours may have sold out, but there are a few still available. On retailer aligned contracts there was some minor positivity. Tesco and M&S held their prices for the month, while Sainsbury’s and Co-op announced increases of 0.34ppl and 0.12ppl respectively. The increase in energy costs has led to a resurgence in interest in renewable energy, particularly roof-mounted photovoltaic (PV). Technology is almost certain to help in this area, with the main focus likely to be on feeding and genetics.
Global and domestic demand remain subdued. Latest Nielsen figures indicate volume falls in butter (-1.0%), cheese (-1.5%) and milk (-1.7%) although less steep than in previous months, whilst yogurt and cream have returned to modest growth (=0.1% and +0.7% respectively (source: Nielsen Homescan, 12 we 9 Sep 23). Our latest forecastreleased in September predicted milk flows to slow down in the coming months with a conservative fall of at least 0.5% to be expected. There is scope for production to fall further if prices do not begin to recover this side of Christmas. Looking further ahead, Andersons predicts the number of dairy farmers will continue to decline over the next decade, as will cow numbers. On non-aligned liquid contracts most announcements were for holds, with Crediton, Freshways, Grahams and Muller Direct making no change in October. However, Payne’s Dairies announced a price drop of 1.00ppl for the month. Product availability has outstripped demand in some cases leaving full inventories of butter and cheese in the EU for Q1 with increased production and reduced imports and exports. Available supplies of butter, cheese and whole milk powder (WMP) increased year-on-year whereas that of skimmed milk powder (SMP) has declined. Availability of SMP supplies declined by 20.6% year-on-year in Q1 2023 due to a 32.6% growth in exports.
Wholesale markets
In contrast to the volatility seen in yields as farmers reacted to cost pressures and forage shortages, the GB milking herd has remained relatively stable. The long-term trend of gradual decline continues – though the latest data showed the smallest annual contraction in the October herd since 2017. Overall, the number of cows in the milking herd at the time of the December forecast was marginally up on the previous projection, contributing slightly to the lift in forecasted volumes– but this had a minor impact compared to changes in yields. There appears to be very little data on this, but the AHDB is progressing energy benchmarking. Grant aid via the Farm Equipment and Technology Fund in England should be available. Renewables In the first four months of this year, cuts to milk prices (excluding aligned) have ranged from 3.5ppl and 10.5ppl, with further cuts expected for May, although Freshways have held price for May while Tesco are returning to its cost model, increasing the milk price by 1.0ppl in May. Chinese demand has remained disappointingthus far due to increased Chinese domestic dairy production and economic challenges. The extraordinary inflationary pressures facing consumers through 2022 put a strain on shoppers’ budgets. This resulted in the majority of consumers claiming to be spending less on the weekly food shop and eating out. In terms of retail sales, all products saw lower volume sales, although the revenues were up.
In some areas of the UK, grass grows every day of the year and using slurry little and often may well be much more sustainable and efficient than storing it for long periods.EU are forecasting a drop of 0.2%in milk production for 2023. This is in response to a declining dairy herd and lower prices forecast to drive a decline in production in the second half of the year, despite good yield growth. Perhaps the most challenging legislation is around increased slurry storage. Grants will be available to increase capacity to six months, providing the storage is covered. The legal obligation (for now) remains four months. However, family businesses often see this as a price worth paying, providing flexibility and an acceptable lifestyle on what is effectively a 24/7 operation. Legislation Global milk productionin July fell into slight decline of -0.1% year on year. This still meant that the 12-month picture was up by 0.48% year-on-year but perhaps signs that as prices cool globally, the production tap is beginning to be turned down.
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