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UK Leads Europe on Dairy Restructuring

02 July 2009

UK - Despite of a dismal six months, the UK dairy industry is ahead of Europe in terms of restructuring says a new market analysis from Kite Consulting.

The analysis shows the opportunity available to UK dairy farmers to stabilise milk production in the years ahead, if farmers have the confidence to invest and grow their businesses, as the heifers are in the pipeline.

In the summary the analysis goes on to say that world stocks levels will be a primary influence on world market prices moving forward. Tracking stock levels will therefore be important as small changes will have a significant impact on price. Better information is required, as already found for most other major agricultural commodities.

"Although we face a volatile future, profitability for good dairy farmers will improve in the medium term compared to recent years," says the analysis. "The current market dynamics will widen profit differentials - the rewards for efficient, flexible businesses will be greater whilst inefficient businesses will be exposed and more likely to fail.

"Trust and confidence throughout the supply chain is vital. Customers must ask themselves what they are doing to build trust and encourage stability, for the benefit of everyone in the supply chain."

TheCattleSite News Desk



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