UK: GB producer numbers impacted by falling milk prices

In our latest survey of major milk buyers, it is estimated that there were 7,500 dairy producers in GB as of October 2023. Year on year, this is an estimated decline of 350 dairy producers (-4.5%), although no change reported from our previous survey in April. A major driver in the year-on-year decline has been the fall in farmgate milk prices. In September the Defra UK average milk price stood at 36.36ppl, a drop of almost 13ppl compared to the same month in 2022. Paired alongside this, despite inflationary pressure on key farm inputs easing, farm costs such as energy, fuel, feed and fertiliser remain historically high, with plenty of volatility in the markets. This has resulted in farm margins tightening. Average milk production per farm has grown year on year but remains steady compared to volumes calculated in April this year. This indicates a shift towards larger farms. In addition, with high milk prices in the latter part of 2022 many farms pushed their cows for increased ...