For the second month in a row, milk prices have been slashed as farmgate milk prices fall down to match dairy commodity price reductions that occurred during the autumn and over winter.

The moves will crystalise decision-making for some farms that are higher input users.

With the cost of production now reaching in excess of 40c/l on established farms, once they put a value on own labour, a base milk price of 45c/l shows very clearly margins are getting very tight.


If you consider the increased cost of borrowing, the threat of much reduced stocking rate with proposed nitrate derogation changes and higher input costs, you can quickly see that startup businesses or those expanding have little room for manoeuvre and need to think very clearly about how the business case stacks up.

Again, the most important part of this is the people making all this work happen, and taking a break before breeding starts or giving a break to others might be the best money you’ll spend this year to keep the business on the straight and narrow.