Archive: Outlook 2015 the dairy breakout session

Published 12 February 15

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The Outlook 2015 conference The 2015 conference programme explored factors that impact delegates’ businesses in their respective sectors, including trade developments and emerging opportunities.

At the dairy break-out session delegates were told by Luke Crossman, senior analyst AHDB DairyCo “Dairy markets have completely reversed from a year ago with milk prices falling around 20%, due to the global supply and demand imbalance. “However, in the long term, five years plus, farmers remain fairly optimistic in both their business and the industry. 

“Farmers potentially see the positive messages about long-term demand for dairy products as presenting opportunities to the industry. The survey suggests that based on farmers stated intentions one third planned to expand milk production in the next two years. If those farmers do expand then the increase in production will amount to 6%. It is important to stress this farmer intentions prediction is coming off a year of boosted production due to good weather.” 

While those surveyed stated they intend to invest, they plan to do so largely in infrastructure, with 62% and 46% planning investments in farm buildings and equipment respectively. “Despite the recent struggles some dairy farmers faced since the last survey (December 2013) those intending to exit the industry have risen just two percentage points to 6% (up from 4% in 2013).

However, caution must be exercised when interpreting the survey data given the reduction in milk price since the survey was done. The longer margins remain under pressure the more farmers may reconsider the future of their businesses.” 

“Overall, the positive factors combined suggest long term commitment to the industry although market improvement and price stabilisation are yet to be fully realised. There are glimmers of this with the recent Global Dairy Trade auctions, but it could take some time before wholesale prices (and thus farmgate prices) react.”

You can download the main presentations from the day using the links below. Video content from the event will be available soon.

Visit the Eblex site for all the links to all the presentations from Outlook 2015

Specific dairy breakout session presentations

 View the conference in tweets here