Tipping point is approaching for dairy farming

The yield in dairy farming shows a minimal peak upwards. It is mainly motivated by the relatively good milk price. However, a tipping point is approaching, partly because costs are steadily rising. 

The Countus Dairy Cattle Index is 37 points in week 107,90. That is a big difference with last year, when the Dairy Cattle Index came out at 134,40 points. However, it is a good reflection of the current situation in the market.

Statistics Netherlands' 'quarterly phosphate monitor' shows that a higher milk production per cow could partly compensate for the smaller size of the herd. In the second quarter of 2018, the decline in the number of dairy cows will continue. With an almost constant production, the average production volume decreases. Due to the relatively good milk price, income is still at a good level, but expenditure is rising (particularly due to the rising feed costs). 

Pressure on dairy prices
Later in the year there will be pressure on dairy prices, especially the price of butter. However, this cannot be accommodated by the small pluses in the protein. The price of cheese also relies heavily on this, which means that the current situation urgently needs to change in order to support the milk price.

Dairy farming is currently approaching a difficult phase. In 2019, Brexit will have an effect on the dairy market, whereby every disruption will be 1 too many.

Herman van den Pol

Herma van den Pol has been with us since 2011 Boerenbusiness and has developed over the years into a market expert Milk & Feed. In addition, she can be seen weekly in the market flash about the dairy market.

h.vandenpol@boerenbusiness. Nl

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