English milk balance

By Chris Gooderham

Supply

The volume of milk coming off English dairy farms has remained relatively unchanged for the last four years. In 2020/21, it is estimated at 9.0 billion litres of milk, just 0.5% lower than the year before.

The slight drop was a result of a 1.7% reduction in the size of the milking herd, partially offset by an estimated 1.2% lift in milk yields. The English dairy herd continues to contract, having fallen by 4.3% since 2015. Over the same period, the Scottish herd size has fallen by only 1.6%, while Wales’ has increased by 2.4%. For the most part though, the drop in cow numbers in England is being offset by increasing average yields.

Processing

While milk off farms has remained stable, the volume of milk processed in the country continues to increase. Our latest estimate suggests the deficit in milk volumes available for processing increased by 7% to 1.25 billion litres in 2020/21. That is more than 40% higher than it was back in 2017/18.

Of the milk processed in England, 52% was used for liquid milk and just 21% used for cheese.

The future

Long-term trends in consumption and processing show an increase in the amount of milk used to make cheese and yogurt, and a reduction in the volume used for liquid milk.

In England, the main cheese manufacturing sites continue to expand. However, in order to maintain, or grow, their share of the domestic market they need to remain competitive with imports. Their ability to achieve this is reliant on expansion continuing, and access to the additional milk they require at a competitive price.

Thankfully, the main cheese plants tend to be situated in key milk fields that have seen increasing milk production. Over the last few years, milk volumes have increased in the south-west and north-west of England, while they’ve fallen in the east.

This alignment of farmers and processors is critical for the supply chain to remain competitive and deliver profitable returns.

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