Trade Talk by Meg Elliott

25th October 2016

Heading into the Autumn months, one wonders what might be in store for the dairy trade, particularly after such a tumultuous year.

From the depths of genuine despair in the spring, the job has seen a considerable improvement mainly due to the substantial increase in spot price and the perceived general under production.

The heady heights of regularly surpassing the £2000 mark for fresh heifers are yet to truly return, but many would forecast that this may not be far away. Extensive culling earlier in the year together with a marked switch to beef services would suggest that black and white females will be in short supply before too long.

What is for certain is that this increase in the spot price must filter through to the "men on the ground" despite the reticence of suppliers, before any trade improvement can be achieved.

Having said that the dairy trade is still solid and for many provides a necessary additional income in these difficult times. Best heifers in recent weeks have been in excess of £1700 with a particularly strong following growing for the minority breeds.

In the last few months we have seen the average for fresh milkers on a weekly basis fluctuate greatly. From the highs of over £1400, post the jump in spot price, back to the more realistic level of £1150-£1200 bearing in mind the continued reluctance from the suppliers to pass this optimism on and give a fair price.

As for herd dispersals, well I truly believe that the majority of milk producers still in production want to stay in it. For the main it is a vocation and they will to their upmost to survive. There is no doubt that some considerable debt has been accrued in the last year however I hope that a fairer milk price will enable them to see it through. I may be guilty of "wearing rose tinted glasses" but I would prefer less dispersals and a better trade than an influx of sales on a trade that is dying due to hard times. Either way as auctioneers we will continue to strive to provide an efficient and effective service for all customers in this trying period.

Meg Elliott Bagshaws & Leek Auctions