One imagines a good many hours were spent by a good many dairy farmers over the new year mulling options for their businesses in the coming year if there is not some early glimmer of positive news for the future of the European dairy industry.
There is no doubt what happens here in the UK is nowadays pretty irrelevant because it is developments in far off places such as China, India, South America, and Australasia where the long term future of British dairying will be decided. When one reads of plans (currently on hold due to economic pressures) for 100,000 cow herds to be established in China it becomes no longer some far off land but, rather, something that will be directly affecting us here in the UK – in sleepy little places up on the Downs, in wet Cumbria or the west of England, as much as in the rest of Europe or the Canterbury plain in New Zealand.
These projected herds will doubtlessly have huge health problems, but in turn, will cause even bigger headaches for dairy farming in the traditional dairying regions of the world. Every extra cow producing milk in Asia is going to have a knock on effect on everyone else in all the old established dairy areas, particularly northern Europe.
When last in New Zealand a few years ago, I was astounded at the reclamation work south east of Geraldine, South Island, where scrub and, unbelievably, semi mature coniferous forest was being grubbed, at huge expense, to turn thousands of acres into new dairy units. Even then it occurred to me where that extra milk was going to be used, because clearly it wasn’t needed in New Zealand, where they have for some years had more cows than humans. My thoughts then turned to their exports to Japan, Korea and China, since they were geographically close and natural buyers.
That was eight to 10 years back, before China began its dairy expansion and long before Russia stopped importing European Union dairy products. Now these things have happened one has to wonder what is going to turn the clock back and again make foreign dairy produce attractive to those countries? It’s quite hard to see.
So what are the prospects for producing milk solely for the UK market, which is already being drowned out by increasing imports of processed dairy products seeking a home from our European neighbours?
Unless one has a captive audience in the locality, a niche product or even, more importantly but less likely, a nearby processor who sees the value of helping the survival of its local dairy farmers, our prospects are looking dimmer by the week.
At our own personal level, as family dairy farmers in for the long haul we, like most others, have our farm and system set up for dairy. Unless one has an accountant’s mind set it’s not something one can jump in and out of without great upheaval. Yet it has to be considered, and in many cases, quickly. So it is just a matter of deciding which route?
The main options for most will be painful and life changing. Many farmers, young or older, will perhaps be still hoping things will come right while their money and enthusiasm lasts. Possibly more to the point, while the banks stay supportive and interest rates stay low. Neither scenario can be relied upon!
Even those on the better milk contracts are surely aware things cannot continue for long because no buyers can afford to buck the market. Why should they continue paying 20% or so over the going rate for raw milk?
My own feelings are to give the operation another year or so, hoping events prove me wrong, and milk on. But I say that more in hope than with any conviction. So one needs to be considering all options.
Up horn down corn is no longer relevant as almost everything is presently down. Maybe it would be better to fallow the whole lot rather than bolster the profits of the agrochemical industry. Take the diminishing European Union pay outs, lay off any staff one still employs and let any free cottages? But then, when/if we as a country pull out of the EU next summer, losing the present payments system, what then? Best wait a bit I think!
Sell the herd and let the farm? What sort of option is that? Because why should it be feasible for anyone else to make a living if the present generation of farmers cannot manage?
Sell the herd and run beef cattle? Would you really want more risk? Do you trust the government to sort out the TB situation? They certainly don’t fill me with any confidence.
Or just settle for milking your old cows, until you can no longer stand the anguish and pain. At least you will still be a dairy farmer, just an even poorer one.
I am sure you will have been through many similar thoughts yourself, and realise the issues. In an ideal world you perhaps plant a vineyard and live in a haze of regular doses of your own Chateau Anglais until it takes its inevitable toll. At least you may not then need to bother considering the options. Or buy a little farm in the Alps.
Apart from these last two it’s not a pretty list of choices is it, not what you maybe set your sights on for retirement when you set out 40 or 50 years ago. But it is most likely the situation that’s fast approaching, unless you can survive with milk at 1993/4 prices. Unfortunately, it’s not the same with costs.
Alternatively ring your local auctioneer, arrange the sale, sell up, and end the worry. Not the best way to start the new year?