Writing in Andersons Outlook 2021, joint authors Mike Houghton, Oliver Hall and Jake Armstrong-White say that for most in the British dairy sector it has been a 'relatively stable year' in respect of milk prices, with the exception of those badly hit by the almost immediate loss of the hospitality and food service markets as a result of the coronavirus crisis. The report states, at the time of writing, that the average UK milk price is around 27.6p/litre - 10% lower than the average EU farmgate price, equivalent to 30.15p/litre.
"The focus for the future should be on efficiency and not output. Our most profitable clients are those practising low cost, medium output, grazing-based systems with the yield from forage at >4,000 litres. Other key characteristics include block calving, cross breeding to enhance milk solids, and an absolute focus on cost control," they comment. British dairy farmers will face additional challenges over the next few years, the authors say, with the end of the Brexit transition period in 2021, the demise of the Basic Payment Scheme (BPS) by 2027 and legislation to cover slurry pits by 2026. But greenhouse gas emissions could be the industry's greatest challenge heading into 2021, the report predicts, with covering slurry pits just the tip of the iceberg.
The National Farmers' Union (NFU) has already committed to the ambitious goal of reaching net zero emissions across the whole of agriculture in England and Wales by 2040 - a whole decade ahead of the Government's legally-binding target of 2050. On a global scale, the Agriculture and Horticulture Development Board (AHDB) reported recently that if all cows performed to the same level of output as the average British cow (7,900 litres) the population of dairy cows in the world would fall from 265 million to just 83 million. The British dairy industry needs to lead this debate, the report's authors urge, and not be driven by it