DairyCo, a national farmers association focused on improving milk supply, says that reduced production during the autumn of 2008 may have offered short-term cost benefits for producers, who claim to be struggling to meet their own costs. However, on a wider-scale basis, the group warns that troubles may lie ahead, with ramifications that could open up the country’s processors to increased challenges from European rivals.
Citing estimates from the UK’s Department for Environment, Food and Rural Affairs (DEFRA), DairyCo said that the number of milking cows in the country is expected to continue falling up to 2010. The same figures suggested that at the end of the 2008 milk year last March, 13.2 billion litres of milk were supplied in the UK, a fall of 2.3 per cent compared to the previous 12 month-period.
In a recently published report by DairyCo entitled, Factors Affecting Milk Supply, the association claims that a failure to ensure consistency in raw material sourcing could increase the vulnerability of UK companies to imports of domestic products.
The association says that seemingly more isolated national products such as liquid milk and value-added cheddar cheese could be areas in danger as a result of reduction in national dairy farming.
Citing an increasingly globalised dairy sector, the report suggests that falling milk supplies could lead processors to lose faith in the industry and cut investment in the UK Market, setting back all members in the supply chain.
“This lack of investment from our domestic processors, or an unwillingness by the major global players to invest in the UK, with all of their advantages of scale and established R&D and innovation programmes, would inevitably disadvantage our farmers in the longer term,” stated the report.
One possible area of improvement for farmers suggested by the report could be in measures cutting down on cow replacements used to prop up dwindling heard numbers.
A seeming trend towards dairy cows with longer lives therefore may be positive development for the industry, reducing the need for replacement animals that can slow down supply, according to the report.