Archive for financial relief

UK Milk Prices Surge to 43p/litre

UK milk prices surge to 43p/liter. What does this mean for dairy farmers? Ready to navigate the market and boost your profits?

Summary: UK dairy farmers are set to benefit from a lift in farmgate milk prices to 43p/liter, a significant milestone for dairy farmers. This growth is driven by increased demand for butter, cream, and cheese and a tightening milk supply. The Global Dairy Trade auction saw wholesale dairy values increase by 5.5%, favoring dairy farmers. However, this rise in demand correlates with a decrease in milk availability in the UK, with deliveries averaging fewer than 32 million liters per day at the end of August. Higher farmgate prices provide immediate financial relief and increased profitability for dairy producers, but they also make it difficult to manage supply and demand effectively. As demand for butter, milk, and cheese rises, producers must ensure their production systems can fulfill it without overburdening resources. Company-specific price adjustments to address the growing demand include Arla Foods increasing its milk price by 0.89p/liter to 43.33p/liter for regular production, Muller paying producers an October price of 41.25p/liter, Barbers Cheesemakers increasing milk payments to 43.03p per regular production liter, First Milk raising its price to 42.6p/liter, and Organic Herd raising its organic milk price to 56p/liter.

  • Farmgate milk prices increased to 43p/litre due to rising demand for dairy products.
  • Global Dairy Trade auction recorded a 5.5% rise in wholesale dairy values.
  • Companies like Arla, Muller, Barbers Cheesemakers, and First Milk announced price hikes for September and October.
  • Tightening milk supplies have been a significant factor in price increases.
  • Producers have an opportunity to enhance profitability and production efficiency.
Farmgate milk prices, UK, 43p per liter, dairy farmers, increased demand, butter, cream, cheese, milk supply, Global Dairy Trade auction, wholesale dairy values, higher prices, financial relief, profitability, supply and demand, milk availability, decrease, deliveries, balance, overproduction, resources, retail sales, stable milk supplies, price adjustments, Arla Foods, Muller, Barbers Cheesemakers, Milk, Organic Herd, price increase.

Farmgate milk prices in the UK have risen to an astonishing 43p per liter, representing a key milestone for dairy farmers. Critical reasons driving this growth include increased demand for butter, cream, and cheese and a noteworthy tightening of milk supply. “Strong demand for butter and cream in the EU market is driving prices to near-record levels”— Nick Holt-Martyn, Principal Consultant at The Dairy Group. The recent Global Dairy Trade auction saw wholesale dairy values increase by 5.5%, indicating that market dynamics favor dairy farmers. As you negotiate this shifting terrain, you may question what it means for your dairy farm.

Surge in Farmgate Prices: The Autumn Uplift 

As we examine the present status of the dairy industry, it is clear that dairy producers are seeing a considerable increase in milk prices. Farmgate prices rose to 43p/liter in September and October, indicating a prosperous season for dairy production.

Butter, cream, and cheese are in high demand, increasing prices. Nick Holt-Martyn, chief consultant at The Dairy Group, said, “Strong demand for butter and cream in the EU market is driving on to near record levels.” His findings are consistent with a more significant trend in which processors are keen to stockpile milk quantities for the fall months.

Supporting this story, the most recent Global Dairy Trade auction on August 20 recorded a 5.5% rise in wholesale dairy values, with significant price increases for butter and milk powders. The growth in worldwide demand has driven significant profits for processors.

This rise in demand for dairy products correlates with a decrease in milk availability in the UK. Since the spring flush, UK milk deliveries have averaged fewer than 32 million liters per day at the end of August, representing a 0.9% decline from the previous year. This shrinking supply has unwittingly led to price rises as processors try to fulfill increased market demand.

Transforming Challenges into Opportunities 

The immediate effect of the price increase on dairy producers cannot be understated. Higher farmgate prices provide immediate financial relief and increased profitability. For many farmers, this additional earnings is a welcome lift after difficult seasons typified by variable milk supply and growing operating expenses. According to Arthur Fearnall, Arla Foods’ board director, “Global milk supplies continue to be stable while retail sales continue to grow.”

However, it is not all easy sailing. While higher prices bring some relief, they also make it difficult to manage supply and demand effectively. Richard Collins, Muller’s head of agriculture, emphasizes this balance, noting, “We’re pleased to see market stability, and following a 1.25p/liter increase to our farmgate milk price in September, we are in a position to increase it again by 1p/liter in October.” We understand the continuous strains on our providing farmers, and we will continue to monitor supply and demand.”

As demand for butter, milk, and cheese rises, producers must guarantee that their production systems can fulfill it without overburdening resources. It’s a tricky balance between profiting from increased pricing and avoiding overproduction. This cautious management will be critical in navigating the following months, ensuring that the advantages of the price increase are fully realized while limiting possible hazards.

Company-Specific Price Adjustments: A Closer Look 

Let’s look at the company-specific pricing adjustments to see how each major player responds to the growing demand for dairy products.

Arla has increased its milk price by 0.89p/liter to 43.33p/liter for regular production later in September. The business credits this gain to a steady global milk supply, consistent retail sales growth, and strong demand for fat-heavy goods, particularly butter.

Muller has reacted favorably to the market’s steadiness. The business intends to pay its producers an October price of 41.25p/liter, including the advantage premium. Muller will raise farmgate milk prices by another 1p/liter in October after a 1.25p/liter increase in September. This initiative demonstrates Muller’s commitment to providing farmers despite continued market difficulties.

Barbers Cheesemakers has recently reported an increase in its milk payments. In October, producers who supply this famous cheesemaker will get 43.03p per regular production liter.

First, Milk follows suit, raising its price by 0.6p/liter to 42.6p/liter for a regular production liter, including the member premium. Mike Smith, vice-chairman and farmer director, said that this increase is a welcome respite given the difficult on-farm circumstances of the spring and summer.

Organic Herd stands out with a significant rise, indicating that it would raise its organic milk price by 2p/liter on October 1 to 56p/liter. This considerable increase demonstrates the continuous demand and value put on organic milk in the present market.

Market Dynamics: Riding the Wave of EU Demand 

Several variables impact dairy market dynamics, most notably the EU’s constantly fluctuating demand. Farmgate prices in the UK have risen due to increased demand for dairy products like butter and cream, driven by consumer preferences and a shortage of milk. This situation has provided a beneficial climate for UK dairy producers, who have seen price increases into 2024. Demand from the EU remains a key factor, driving volume and stabilizing prices at higher levels.

What will the future hold for dairy farmers? Industry analysts recommend a cautiously positive attitude. Arthur Fearnall, Arla Foods’ amba board director, underscores the stability of global milk supply while highlighting the continued development of retail sales. Although slower than in past years, this rise signals that demand for dairy products will remain strong, perhaps keeping the market robust. The seasonal decrease in milk consumption adds another layer of complication, likely maintaining stable prices in the foreseeable future.

However, it is critical to recognize the uncertainties and possible hazards accompanying this promising trend. Tightening milk supplies, especially since the spring flush, may put processors under pressure if demand continues to outrun supply. Furthermore, significant interruptions in global supply chains or economic downturns in important areas might dramatically alter the situation. Muller’s Richard Collins understands these constraints and reiterates the need to monitor market developments in the coming months attentively.

Although high farmgate prices and increasing EU demand provide a bright scenario for UK dairy farmers, they must stay alert. Seasonal influences, supply limits, and macroeconomic variables will all influence the market’s trajectory. Staying aware and adaptive will be essential for dairy producers looking to take advantage of current good circumstances while also bracing for market changes.

Practical Tips for Farmers 

With farmgate milk prices increasing, now is an excellent moment for dairy farmers to optimize their operations and capitalize on market opportunities.  Here are some practical tips that can help: 

Enhance Milk Production Efficiency 

Focus on keeping your herd healthy and productive. Regular veterinarian examinations and proper feeding planning are essential. Use high-quality feed to guarantee your cows produce milk to their total capacity. Consider investing in technology, such as automated milking systems, to help procedures run more smoothly and efficiently.

Cost Management 

Reducing expenditures in this favorable price climate may help you optimize your revenues. Bulk purchases of feed and supplies may save money. Energy-efficient devices may help cut electric expenses. Reviewing your spending regularly and discovering areas where you may save money without sacrificing quality is prudent.

Leverage Higher Prices 

Securing contracts with processors for a steady income can help you take advantage of increasing milk prices. Expanding your product offers, such as exploring organic or specialized milk products, which may fetch even higher pricing, is also essential. Keep an eye on market developments and adapt your approach appropriately.

Stay Informed 

Market circumstances might change quickly. Stay up to speed on industry news, attend local dairy farming conferences, and connect with other farmers to exchange ideas. Joining industry organizations or associations may also give helpful knowledge and assistance.

Be Adaptable 

Flexibility is essential for managing the turbulent dairy market. If required, be prepared to change your production levels and expand into other markets. Continuously assess the success of your agricultural operations and be ready to adjust to remain competitive.

The Bottom Line

The recent increase in farmgate milk prices is a watershed moment for dairy producers. With prices rising due to greater demand and limited supply, a unique chance exists to improve profits. Key businesses such as Arla, Muller, Barbers Cheesemakers, and First Milk have all announced significant price increases, underscoring the favorable market conditions. To accept these changes, we must maximize production efficiency, control costs, leverage more excellent pricing, keep educated, and remain adaptable.

How will you make the most of this opportunity? What actions would you take to guarantee that your farm flourishes in these favorable market conditions?

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The Untold Story of K-Kuipercrest Inspir Ardath: The Greatest Holstein That Never Was

Uncover the unknown tale of K-Kuipercrest Inspir Ardath, the Holstein cow that amazed the dairy world but never achieved her full potential. Want to find out why?

Once upon a time, there was a Holstein cow named K-Kuipercrest Inspir Ardath. Lawyer and esteemed dairy cattle historian Ed Morwick nearly acquired a half-interest in her. While he ultimately did not secure that half-interest—something that, in hindsight, was fortuitous—it turned out to be quite the setback for David Brown.

First, Let’s Introduce our Two Protagonists.

David Brown, like all of us, had his flaws. Endowed with remarkable skills as a breeder, showman, and promoter, he was often hailed as the finest cattleman of his era. Growing up on Browndale Farms in Paris, Ontario, he had towering expectations to meet. His father, R.F. Brown, was a luminary in the dairy world, winning the esteemed Curtis Clark Achievement Award in 1988 and the Klussendorf Trophy at the 1993 World Dairy Expo. As one of Canada’s most successful breeders, R.F. clinched Premier Breeder and Exhibitor honors at the World Dairy Expo and the Royal Winter Fair. His accolades included five Grand Champions at the Royal Winter Fair: Green Elms Echo Christina (1972 and dam of Browndale Commissioner), Vanlea Nugget Joyce (1974), Marfield Marquis Molly (1978), and Du-Ma-Ti Valiant Boots Jewel (1988). David certainly had big shoes to fill.  And fill them he did. His list of accomplishments was extensive: He led Ontario’s top herd in production in 1991, bred two All-Canadian Breeder’s Herd groups, and produced the All-American Best Three Females in 1998. He was twice crowned Premier Breeder at the International Holstein Show and accumulated 92 awards in All-Canadian and All-American contests from 1986 through 2004. Yet, despite two auction sales in 1991 and 1996 aimed at reducing his debts, financial relief was elusive. Over time, his wife left him, his children moved away, and his prized cattle were sold off. Eventually, David relocated to Colombia, where he passed away. Views on Brown are mixed—some saw him as a charming inspiration, while others regarded him as a rule-bending showman or an irresponsible debtor. Nonetheless, his rapid ascent and remarkable achievements in his lifetime are indisputable. Many wealthy individuals have invested vast sums of money into the cattle industry, chasing the same recognition, only to leave empty-handed. What distinguished David Brown was his nearly mystical talent for preparing animals for the show ring and transforming them into champions.

Edward Young Morwick, a distinguished author, cattle breeder, and lawyer, was born in 1945 on the Holstein dairy farm owned by his father, Hugh G. Morwick. His early memories of his mother carrying him through the cow aisles profoundly shaped his trajectory. Although Edward pursued a career in law, excelling immediately by finishing second out of 306 in his first year, he harbored a deep-seated passion for journalism. This led to his later work chronicling Holstein’s cow history. His seminal work, “The Chosen Breed and The Holstein History,” stands as a cornerstone for those delving into the evolution of the North American Holstein breed. In it, he compellingly argues that the most influential bulls were those of the early historical period. (Read more: Edward Young Morwick – Country Roads to Law Office)

The Story of K-Kuipercrest Inspir Ardath 

Arthur Kuiper meticulously built his herd around the cornerstone cow, Stone-Front Prestige Angie, at his Waupun, Wisconsin farm. Angie was a direct descendant of Prestige of Lakehurst, who himself hailed from the legendary Romandale Reflection Marquis, bred by Agro Bros. in Hamilton, Ontario. For those familiar with dairy cattle lineage, Marquis was an icon, undefeated in the aged bull class from 1967 onwards—the year he catapulted onto the premier show circuit. He earned the prestigious title of All-American aged bull not once but twice.

Stone-Front Prestige Angie produced an exceptional Paclamar Astronaut daughter named Stone-Front Astronaut Angela, who was in the dam when arriving at Kuipercrest Farm. Angela achieved an Excellent rating and recorded an impressive output of over 25,000 lbs. of milk. She then gave birth to Kuipercrest Warden Ardela, a Hilltopper Warden daughter. Ardela also achieved an Excellent rating, her pedigree further enhanced by a double cross of Astronaut genetics, tracing back through Warden’s mother.

In the late 1970s, Kuiper decided to sell off his herd. However, his emotional ties to a few members of the Angie family made him hold onto them. Faced with the challenge of finding a place for these cherished animals, he struck a deal with Theron Keller, a promising young farmer from Richland Center, Wisconsin. In exchange for Keller’s commitment to their care, Kuiper offered him partial ownership of some of these prized cattle.

In 1987, Kuipercrest Warden Ardela gave birth to a daughter named K-Kuipercrest Inspir Ardath. The “K-Kuipercrest” prefix honored both Keller and Kuiper, while “Inspir” highlighted her sire, Hanover-Hill Inspiration. Ardath’s early years were typical for a calf, marked by average growth and development. In fact, she flourished much more than the KuiperKeller partnership itself. Primarily a cash crop farmer managing extensive land, Keller wasn’t providing the cattle with the meticulous care Kuiper believed they deserved.

Brown’s Return to Our Story

In March 1993, David Brown made an incidental stop at the Fond du Lac sale barn during a visit to Wisconsin. Positioned in the front row was the enormous K-Kuipercrest Inspir Ardath. Despite her fleshy and ample appearance, Brown’s expert eye was immediately drawn to her front legs, particularly the femur— the skeleton’s longest bone, which connects the knee to the upper body. Even though Ardath was as rotund as a bear preparing for winter, Brown was confident she could be transformed into something extraordinary. The length, shape, and contour of her femur bone unequivocally promised it.

After leaving what was the winning bid with the sales manager, Brown returned to his Cher-Own Farm in Paris, Ontario. Before long, K-Kuipercrest Inspir Ardath had made her way to his barn. You would have encountered her if you stepped through Brown’s milkhouse door in June 1993. She stood in the second box stall, her chin perched on the top rail, with her hindquarters seemingly touching the pen’s eastern wall. Her stature was so impressive and her presence so commanding that one’s initial impression felt almost like an illusion.

Despite being before cell phones and the internet, word of a “special” cow would spread like wildfire through the “dairy industry”. Visitors came in torrents. Mexican and South American buyers on the back roads buying cattle asked their Canadian agents for side trips to the CherOwn farmstead to see K-Kuipercrest Inspir Ardath. They came; they stared in amazement. The cow looked great alongside two Royal Winter Fair Grand Champions, Du-Ma-Ti Valiant Boots Jewel and Merkley Starbuck Whitney, who occupied adjoining box stalls.

When Ken Empey first laid eyes on Ardath, he was struck with awe. He left the stable, sat in his car for a moment, and then felt compelled to return to the barn. He stood there, staring at her for another ten minutes. Finally, he went back to his car and drove off. In Empey’s estimation, K-Kuipercrest Inspir Ardath was superior to Brookview Tony Charity in every conceivable way.

Public interest surged and offers rolled in. Yet, Brown deemed them frivolous, most hovering around $100,000. He stood firm, unwavering in his quarter-million-dollar valuation.

Morwick’s Return to Our Story

To Morwick, the cow seemed undervalued. He speculated that she could potentially rival the legendary Glenridge Citation Roxy or even Snow-N Denises Dellia. From his perspective, investing in her was a far superior choice compared to acquiring a descendant from the Roxy or Lulu families, despite their high demand at the time. Roxys and Lulus were abundant, with hundreds on the market.

Standing there in all her glory: an outstanding bovine specimen with three generations of Excellent-rated dams; her lineage included a twice All-American great-granddam, and she descended from the top sires of their respective eras. Indeed, it is a remarkable pedigree.

”Yes,” said David Brown, “I value this cow at a quarter-million dollars, and I’ll take $125,000.00 for a half interest.

There’s lots of money left in her, even at that price.”

“Surely not for Morwick,” Morwick said. ”You wouldn’t charge him that much, would you?”

“Sure would,” said Brown.

The Enigma

Morwick was taken aback by Brown’s lack of leniency, especially considering the hefty legal bills. Brown had accumulated $25,000 in fees with Morwick’s law office, including costs from suing Holstein Canada over disciplinary actions for supposed ethical breaches at the Royal.

One day when Morwick asked Brown when he might pay, he got choked up and teary. “Surely you can pay something,” Morwick said.

“These bills represent a lot of work.” In the end, he gave Morwick a cheque for $5,000.00. I told him he could forget the rest.

Morwick decided to absorb the loss.

If David couldn’t pay Morwick for quality work faithfully performed, he asked himself, then how did he come up with the $5,000.00 he paid for K-Kuipercrest Inspir Ardath?

This was the enigma.

Morwick felt that “All these show guys are the same. Big shots with not a pot to let go in, they can always come up with enough money to buy a good cow. In these guys, ego always gets ahead of responsibility.”  Morwick felt this way as he had worked with Holstein promoters for twenty-five years.

Thus, despite Morwick’s earlier gift of $20,000.00 to Brown, the latter now expected Morwick to pay the full price for a half share in his prized cow.

Morwick figured an offer in writing might tempt him. He drew up a contract: “Offer to Purchase re: K-Kuipercrest Inspir Ardath,” the document was titled. The parties to the contract were David John Brown (hereinafter “Vendor”) and Edward Young Marwick (hereinafter “Purchaser”).

There were the usual paragraphs, all with appropriate titles. Paragraph 3 said, “The Purchaser hereby purchases, and Vendor hereby sells, for the sum of sixty-five thousand dollars, a one-half interest in K-Kuipercrest Inspir Ardath.  

It said the purchase price will be paid in cash upon closing this transaction.”

Paragraph 4 states, “Purchaser acknowledges that he, his veterinarians, or other persons on his behalf have personally inspected Ardath and are satisfied that she is in sound condition and free from disease or defect.”

The heartbreaker was paragraph 5: “The parties agree to obtain and maintain mortality insurance and insurance against all the usual perils in an amount equal to at least $130,000.00.”

Morwick’s secretary prepared the Offer with blue document covers and red seals for the signatures of both the Vendor and the Purchaser. I placed four copies into an envelope and delivered them to Brown. He extracted one and placed it deliberately atop the milk cooler.

He read the Offer. Very slowly. He came to the dollar amount. “Nope,” he said, “not enough money.” He picked up all four offers, placed them together, shook them up and down, and hit their bottoms on top of the cooler so they were all together in a tight little stack. Then he handed them back. “Give me a hundred and a quarter for a half-interest,” he said. “There’s plenty of money left for both of us.”

The next day, walking up John Street, Morwick passed a coffee shop they called the Donay Cafe. There was a For Sale sign in the window. I called the broker. “It’s listed at $199,000.00,” he told me. “Wanna look at it? It’s a power of sale. It’s going cheap.”

“Sure,” Morwick said. ”I’ll meet you there in an hour.”

Morwick redirected the $135,000 originally set aside for the half-interest in K-Kuipercrest Inspir Ardath and invested it in purchasing a building. Subsequently, he relocated his law practice to the ground floor of this new property.

Ardath Goes Head to Head with Legends

In November 1993, Brown exhibited Ardath at the Royal Winter Fair. When she entered the five-year-old class, she was bone dry; Brown had her on a strict diet to refine her form. Despite her condition, Ardath secured a commendable second place, trailing behind Merkley Starbuck Whitney, who was on her path to the reserve grand championship. Whitney, showcased by Brown for her Japanese owners, was in prime condition, with her udder at its peak. The seasoned judges at ringside could not help but remark, “The second cow’s the better one,” with her longer head, broader muzzle, and more correct front legs.

Later in the year, Whitney claimed the title of All-Canadian five-year-old, with Ardath securing the Reserve position. “Just wait until next year,” Brown declared.

The Unfortunate Ending

A month later, Morwick visited Brown’s farm. Ardath was conspicuously absent from the second box stall. “Where is she?” Morwick inquired.

“She’s dead,” said David. “She developed a lung adhesion.”

Part of her lung adhered to her rib cage. It proved fatal.”

“Too bad,” Morwick said.

Brown’s smile turned rueful as he clutched the top rail of the pen with both hands, his gaze dropping to the ground.

“I should have taken your offer,” he said.

“Why?” Mowrik replied.

“Then she would have been insured,” responded Brown.

“She wouldn’t have passed the vet check,” Morwick said. “The vet would have seen the adhesion.”

“No, She would have. Draper would have passed her.”

“That’s the cattle business,” Morwick said.

The Bottom Line

In the competitive world of dairy cattle showing, the story of K-Kuipercrest Inspir Ardath stands out as a lesson in missed opportunities. Navigating pedigrees, evaluations, and high-stakes valuations, this tale reveals the complex interplay of passion and practicality. From Ed Morwick’s initial hesitation to David Brown’s firm pricing, every decision and negotiation shaped Ardath’s unrealized potential. The emphasis on vet checks, insurance, and legal exchanges underscores the need for diligence and strategic partnerships. Ardath’s journey highlights the cost of pride and the importance of protecting investments with foresight and humility. This story serves as a reminder to balance enthusiasm with prudence to avoid squandering potential through neglected connections and misjudged valuations.

The Chosen Breed and The Holstein History by Edward Young Morwick
Anyone who appreciates history will enjoy either the US history (The Holstein History) or the Canadian History (The Chosen Breed) by Edward Morwick. Each of these books is so packed with information that they are each printed in two separate volumes.  We had a chance to interview Edward – Edward Young Morwick – Country Roads to Law Office and got a real sense of his passion and quick wit which also come shining through in his books.  Be sure to get your copies of this amazing compilation of Holstein history.

Key Takeaways:

  • David Brown’s encounter with Ardath at the Fond du Lac sale barn marked the beginning of a high-stakes saga for this extraordinary cow.
  • Ardath’s impressive physical attributes, particularly her femur bone, created significant public interest and high offers, but Brown’s asking price remained firm at a quarter-million dollars.
  • Morwick, a lawyer with substantial involvement in the dairy cattle industry, initially considered investing in Ardath but ultimately chose to purchase a real estate property instead due to disagreements over the cow’s valuation.
  • Despite being highly touted and drawing crowds, Ardath faced an untimely demise due to a lung adhesion, leading Brown to regret not securing insurance as suggested by Morwick.
  • Morwick and Brown’s professional and financial dealings added a layer of complexity and tension to their interactions, influencing the decisions related to Ardath.

Summary:

The story of K-Kuipercrest Inspir Ardath intertwines the fates of legendary dairy cattle historian Ed Morwick, lawyer, and dairy cattle savant David Brown. Ardath, an exceptional Holstein cow with an impressive lineage, captured the attention and admiration of many, including Morwick, who offered to buy a half-interest in her. However, Brown’s high valuation and refusal to settle on a lower price led Morwick to invest in real estate instead. Tragically, Ardath later died due to a lung adhesion, leaving Brown to rue his decision, as the cow could have been insured had he accepted Morwick’s offer. This tale highlights the complex interdependency of passion, investment, and fortune within the cattle business.

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