Analysis DCA Dairy Cattle Index
Dairy farmer returns are not recovering any further
The recovery of returns in dairy farming is delayed, according to the DCA Dairy Index. The coming months are uncertain, not least because of the controversial feed measure that Minister of Agriculture Schouten wants to impose on dairy farmers.
At 84,3 points, the DCA Dairy Cattle Index scored only 0,2 points higher in August than a month earlier, when there was a clear recovery. 100 points is the long-term average. Although milk prices are cautiously moving up again, they are not yet at the level of before the corona crisis.
a lot of uncertainty
It is unlikely that the upward trend of the milk price will continue. Dairy prices fell at the beginning of August as a result of weak sales. Demand from the out-of-home segment in particular is lagging behind due to the corona measures. A windfall for the return is that the cattle lump prices have recently fallen again.
Performance
Dairy farming is faced with a great deal of uncertainty regarding the implementation of the feed measure. If this measure is 'pushed through' by Schouten, this can lead to extra (feed) costs. In addition, it is uncertain what the successor to the measure that will apply until the end of this year will be.
Apart from that, expensive months are ahead in terms of labor costs. The last cuts are not yet off the land, given the beautiful weather and the recent rain. The maize also has to be chopped, which generally takes place between mid-September and mid-October. In addition, manure can be applied until 15 September.
Prognosis
The accounts come at a time when liquidity is under pressure and is unlikely to pick up soon, according to the forecast of the DCA Dairy Index. From September, the yield of dairy farmers may drop again. The index is expected to drop to 82,1 points.
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Jorine Cosse
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