NOVEMBER 2017 NEWSLETTER

Independent representat ion for Dairy Crest Direct DPO

DCD General Manager: Sophie James M: 07879 992099 E: sophie.james@dairycrestdirect.co.uk Your DCD Forum Member: Contact details can be found at www.dairycrestdirect.co.uk

Dairy Crest Farm Business Centre: Freephone: 0800 121 4766 farm.business@dairycrest.co.uk

www.dairycrestd i rect .co.uk

Company Price Month

Arla 31.04 Nov-17

Crediton Dairies 31.00 Dec-17

Meadow Foods 31.00 Nov-17

DC Davidstow Core 30.92 Dec-17

Muller Direct 30.50 Nov-17

Wyke Farms 30.15 Nov-17

Barber’s 30.08 Dec-17

South Caernafon 30.01 Nov-17

Belton 30.00 Nov-17

Glanbia 29.96 Oct-17

First Milk H’West 29.56 Nov-17

Fresh Milk Company 29.00 Nov-17

Arla Direct 29.00 Oct-17

LIQUID LEAGUE TABLE WITH

LATEST DECLARATIONS

4%b/f & 3.3% prot, 30 bacto, 200 SCC, 1mltrs/yr EODC. Excludes seasonality, monthly profile payments, balancing charges, capital deductions, annual/part growth incentive schemes, South Caernafon winter payment and First Milk H’West Tesco Cheese Group Premium. Includes Arla forecast 13th payment.

Sep-17 Aug-17 Sep-16 Oct-17

Bulk Cream £2,830/t £2,850/t £1,710/t £2,180/t

Butter (Unsalted) £6,150/t £6,150/t £3,550/t £5,050/t

SMP £1,525/t £1,550/t £1,670/t £1,350/t

Mild Cheddar £3,450/t £3,425/t £2,975/t £3,365/t

Whey Powder €798/t €870/t €903/t -

AMPE 39.9ppl 40.1ppl 28.5ppl 32.7ppl

MCVE 38.5ppl 38.7ppl 32.4ppl 36.6ppl

SNAPSHOT OF UK AVERAGE WHOLESALE

PRICES & AHDB MARKET INDICATORS

*Please note AMPE/MCVE calculations do not include cost of transport.

Company Price Month

Arla 32.30 Nov-17

DC Davidstow Core 32.00 Dec-17

Wyke Farms 31.22 Nov-17

Wensleydale Creamery 31.20 Nov-17

Barber’s 31.19 Dec-17

South Caernafon 31.03 Nov-17

Glanbia 31.00 Oct-17

Belton 30.75 Nov-17

Cadbury 30.74 Jan-18

First Milk H’west 30.57 Nov-17

First Milk Lake District 30.45 Nov-17

Arla Direct 30.16 Oct-17

Fresh Milk Company 30.03 Nov-17

Parkham Farms—Tesco 29.95

MANUFACTURING LEAGUE TABLE

WITH LATEST DECLARATIONS

4.2%b/f & 3.4% prot, 30 bacto, 200 SCC, 1mltrs/yr EODC. Excludes seasonality, monthly profile payments, balancing charges, capital deductions, annual/part growth incentive schemes, South Caernafon winter payment and First Milk H’West Tesco Cheese Group Premium. Includes Arla forecast 13th payment.

Sources: Milkprices.com and AHDB Dairy dairy.ahdb.org.uk

DECEMBER MILK PRICE

Following negotiation, DCD have agreed a 0.5ppl milk price

increase from 1st December 2017 with Dairy Crest. The increase

will take the Davidstow December milk price to 32.00ppl for a

manufacturing standard litre and 30.92ppl for a liquid standard litre

(standard litre according to Milkprices.com). The league tables to

the left represent the latest milk pricing announcements on

Milkprices.com at the time of printing.

MARKET UPDATE

From unprecedented highs, average wholesale cream and butter

prices fell by 23% and 18% respectively from September into

October. AHDB state that the range of butter prices reported in

October was the widest it had seen in recent times, with prices in

the region of mid to high £4,000s later in the month. SMP prices

have also fallen, suggested as driven by the end of intervention.

AHDB market indicator AMPE has therefore fallen from 39.9ppl in

September to 32.7ppl in October. DG-Agri has also recently

proposed that when intervention for SMP reopens in March 2018,

that the fixed price ’floor’ be removed, with SMP then only able to

enter intervention via a tender process.

Switching focus to MCVE, average mild cheddar prices were

reported to have fallen by £85 per tonne from September into

October, a 2% decrease month-on-month. AHDB report that mild

cheddar developed a two-tier market in October with prices either

falling or remaining stable depending on the quality and spec of

cheddar required. Average whey powder prices have continued to

struggle, falling by a further 11%, with whey butter also down 19%.

MCVE has therefore moved from 38.5ppl to 36.6ppl.

UK milk production is estimated at 1,107m litres for September,

which would be 2.6% higher than the same month last year. The

latest reported figures from AHDB show GB weekly milk deliveries

for week ending 21st October running 2.9% higher than the same

week last year. EU milk deliveries are also up, with the latest

reported figures for August 3.3% higher than the previous year.

TB RULES UPDATE

Defra has announced that all Inconclusive Reactors

(IRs) in the High Risk Area and Edge Area that have

a negative result on re-testing will remain restricted

for life to the holding in which they were found. The

only permitted off movements will be to slaughter

(either directly or via an Approved Finishing Unit). To

release resolved IRs from restrictions, the option of

gamma blood testing (paid for by the animal owner)

will be available to farmers, subject to approval from

APHA. Detail can be found here: www.tbhub.co.uk.

NOVEMBER 2017 NEWSLETTER

Independent representat ion for Dairy Crest Direct DPO

DCD General Manager: Sophie James M: 07879 992099 E: sophie.james@dairycrestdirect.co.uk Your DCD Forum Member: Contact details can be found at www.dairycrestdirect.co.uk

Dairy Crest Farm Business Centre: Freephone: 0800 121 4766 farm.business@dairycrest.co.uk

www.dairycrestd i rect .co.uk

Dairy Crest Direct Limited, Registered in England and Wales, Company No 5094434

Registered Office: Davisons, Lime Court, Pathfields Business Park, South Molton EX36 3LH

DAIRY CREST FARMER MEETINGS

Dairy Crest are holding the following farmer meetings:

29th November 11am Lanhydrock Hotel, Bodmin.

30th November 11am Falcon Hotel, Bude.

NEW FARM ANTIBIOTICS TARGETS

The Responsible Use of Medicines in Agriculture (RUMA) Alliance has announced targets for reducing antibiotic use

across different livestock sectors. The targets were formulated by the RUMA Targets Task Force, which comprised

of a leading vet and farmer for each sector who consulted with key organisations in their respective industries.

The dairy cattle sector has committed to a 20% reduction in antibiotic usage by 2020, with a particular focus

on halving the use of the Highest Priority Critically Important Antibiotics. The work to achieve this will be led

by a newly created Dairy Antimicrobial Stewardship Group, which includes all key organisations in the sector.

The key focus areas for dairy are identified as follows:

Focus 1: Overall reduction in the use of Highest Priority Critically Important Antibiotics;

Focus 2: Selective dry cow management;

Focus 3: Pneumonia/respiratory issues in youngstock;

Focus 4: Use survey data to review the use of antibiotics in foot baths.

The RUMA announcement also recognises the difficulty in establishing an accurate picture of current antibiotic use

in the dairy sector with the current data available and emphasises that an important next step will be encouraging

farmers to record electronically and deliver their data to a co-ordinating hub as a first step towards creating accurate

usage data. More information can be found here: www.ruma.org.uk.

INTL FCSTONE MILKPRICES.COM

UK MILK FUTURES EQUIVALENT (UKMFE)

Jan

05

Jan

07

Jan

11

Jan

09

Jan

08

Jan

13

Jan

12

Jan

10

Jan

06

Jan

14

Jan

15

Jan

16

Jan

17

Jan

18

Jul 0

5

Jul 0

7

Jul 1

0

Jul 0

9

Jul 0

6

Jul 0

8

Jul 1

3

Jul 1

4

Jul 1

5

Jul 1

2

Jul 1

6

Jul 1

7

Jul 1

8

15

20

25

35

45

40

Pen

ce p

er li

tre

UK Milk Futures Equivalent 30/10/17 23/10/17

Jul 0

8

FUTURES UPDATE

The FCStoneMilkprices.com UKMFE

posted its first positive weekly result

in the last week of October, following

eight consecutive weeks of price

declines. The UKMFE results shown

in the graph opposite are derived

from future trades in butter and SMP,

converted to UK pence per litre

equivalents at the latest exchange

rates. The forward curve, as high-

lighted by the green line (Oct ‘17 to

Mar ‘19) currently represents an

average gross UKMFE of 27.67ppl

(previously reported in the October

newsletter at 32.79ppl) and therefore

a milk price equivalent of 24.29ppl

net to the producer after taking into

account 5% processor margin and

2ppl ex-farm haulage. p

With thanks to Milkprices.com and INTL FCStone for giving permission to DCD to reproduce the UKMFE graph.

TEAT SEALANT DECLARATIONS

Reminder that teat sealant declarations were due to be

returned to Dairy Crest by the end of October. Please

return any outstanding declarations as soon as possible.