By Debbie James
MILK producers attending a dairy conference in Pembrokeshire have been warned that milk prices could dip again.
At the South Wales Dairy Conference in Llandissilio, dairy industry analyst, Ian Potter, said that although the sector seemed to be exiting a long and prolonged crisis, the milk price rollercoaster could be heading down again.
At the heart of the uncertainty is the 355,000 tonnes of milk powder in EU intervention stores.
Only 40 tonnes have been removed from stores, and if it cannot be dispatched as aid, it will be soon hitting the open market, which could prove to further worsen the milk price, Mr Potter warned.
"Spot prices are back 35 per cent in two months and easing back, and bulk fresh cream has dropped 25 per cent. Dairy markets will keep falling if this milk keeps flowing as erratically as it does,’’ he said.
Adding to the uncertainty of future farm incomes is agricultural policy post-Brexit.
But Mark Berrisford-Smith, head of economics for HSBC UK commercial banking, said the industry would not be forgotten in post-Brexit politics, although it would be the Treasury rather than Defra who would lead the decision making.
Although the industry accounts for a relatively small portion of the UK’s gross domestic product at primary production level, its value lies in the need for people to eat.
Mr Potter said he lacked confidence that the right people were in place to draw up an agricultural policy.
“What I want to see is one organisation pulling other organisations together rather than people trying to point score,’’ he said.
"We need to pull together and stand up and be counted, otherwise we will be sidelined.’’