Improving your milk price

Factors affecting milk prices and resources to help

AHDB Dairy’s Milk Price Calculator is an online tool to help you achieve the best possible milk price. By inputting farm-specific data, it allows you to see where changes can be made to improve your milk price. There are a number of ways to influence what you receive and this guide highlights potential areas for improvement and signposts where to find further information. 

Hygienic milk quality 

Most milk contracts include limits on Bactoscan and SCC levels, with high readings often incurring penalties. AHDB research has shown that roughly £40m (or more than 0.3ppl) was lost in milk payments in 2015 due to milk being delivered which did not meet buyers’ hygienic quality requirements.

The AHDB Dairy Mastitis Control Plan is a proven, structured, evidence-based approach to mastitis prevention and control (and therefore SCC) in dairy cattle. It is a cost effective solution and supports both good animal welfare and the consumer image of dairy farming. More information about the Mastitis Control Plan can be found here. 

Effective post-milking plant cleaning is essential in controlling Bactoscan readings by removing bacteria and milk residues from internal plant surfaces, but also has an important function in controlling the pathogens. More information and support can be found here. 

In addition, a booklet on Quality Milk Production can be downloaded which helps you and your staff establish procedures that eliminate the risk of antibiotic residues entering the food chain, maintain the clean image of milk and maximise returns.

A poster detailing best practice on how to avoid antibiotic failures is also available and can be downloaded from here (available in different languages). 

Composition of milk – Feeding strategies

Matching milk composition to what your milk buyer wants is the best way to optimise the price paid for your milk. Most pricing schedules provide incentives for higher constituents, such as butterfat and protein, depending on whether the milk is destined for the manufacturing or liquid markets. Adjusting the composition of your milk to match buyers’ requirements can help to improve the price you achieve – although this needs to be balanced against the cost of delivering that extra value.

Information on nutrition can be found here, detailing ways to manipulate milk solids through feeding. 

Fat and protein content in milk can be heavily impacted by the ratios and levels of individual VFAs produced by the digestive system.

Most of the major constituents of milk - lactose, fat and protein - are synthesised in the mammary gland from precursors selectively absorbed from the blood and transported either from the digestive system or from body reserves. Since the amount of water secreted by the mammary gland is directly related to lactose levels, lactose synthesis is the principal driver of milk volume. The primary building blocks of milk fat are the VFAs, acetate and butyrate, with glucose supplying the glycerol required. Milk protein - primarily casein - is produced from amino acids. 

For more support on feeding such as; improving feeding, planning nutrition and feeding, assessing your feed options, managing forage and non- forage feeds and managing dry cow and youngstock feeding click here

Composition of milk - Breeding for long term changes

Breeding has been responsible for a large proportion of the progress made by UK dairy herds since the 1970s in increasing milk production levels. Improvements made through breeding are far less obvious than those achieved by changes in either feeding or management. However, they are permanent and are compounded through each succeeding generation. Breeding can be instrumental in improving profitability and efficiency over the long term, especially in an agricultural climate that is coping with escalating environmental, welfare and financial pressures. For more information on genetics please click here. 

Production pattern– Milk forecasting calculator

As with milk composition, adjusting the timing of when you deliver your milk to what your milk buyer wants can affect the price paid. Many milk buyers, depending on the markets they operate in, incorporate a system of bonuses and/or penalties to encourage a particular delivery profile.

Changing calving patterns, however, is a lengthy and potentially costly exercise, but may provide for a higher average milk price.

The Milk Forecasting Calculator can be used to see how changes to herd size, yields or calving patterns will impact your business. An excel based tool, this calculator uses farm information on herd size, average yield and calving data alongside herd lactation curves to give producers information on the milk production potential for the herd.

Used in conjunction with the Milk Price Calculator, it can demonstrate the potential benefits of changing production patterns to compare with the associated changes in costs.

Decisions for dairy.   

#Decisions4Dairy is an industry-wide initiative. As part of #Decisions4Dairy, AHDB Dairy can support your business by providing relevant resources, farming business templates, efficiency calculators and skills development packages. The practical assistance has been developed to help your business become more robust for the longer term. It’s important to make use of the resources available to you. Click here to learn more. 

It includes a decision tree which has been developed to help you look at options for you and your business. It will take you through a series of questions with answers that will either take you to the next step or to information and support in particular areas. Looking at the foundations of the dairy business, the decision tree will also take you through non-dairy and non-agriculture options for your business.