UK dairy productivity dips

PRODUCTIVITY on the ‘typical’ UK dairy farm has apparently fallen over the last decade.

Herds in other dairy producing countries have seen stable or increasing productivity, according to data from the International Farm Comparison Network (IFCN).

Looking at productivity as pence per litre (ppl) of output, versus input based on a typical 160-cow herd in North-west England, showed a downward trend in the last decade.

The UK is not alone in this, with data showing a typical North German farm experiencing a similar downturn.

However, farms elsewhere are seeing productivity growth. This included herds in long established dairy exporting countries, such as Denmark and Belgium, as well as growing exporters like Spain, Poland and Belarus, said the report.

International productivity comparisons like this often raise two comments – the first being that UK productivity was higher to begin with, so some other countries are simply catching up. This may be partly true, but the data does suggest farms in a few of these countries have now overtaken the UK in terms of efficiency, said IFCN.

The second question – given that a lot of British milk is sold within the UK – is why would this matter to farmers here? The direct impact is that poorer productivity means lower profits because herds use more inputs to make less, it pointed out.

The indirect impact is that imports and exports

. expose the UK to global dairy prices, so UK herds are operating in the same market as herds in Poland, Spain and any other dairy exporting country. Weaker productivity makes it hard to produce at a competitive price while still making a profit, leaving UK dairy products vulnerable to being undercut by countries with more efficient production.