GB producer numbers: sharp decline indicates further consolidation

In our latest survey of major milk buyers, it is estimated that there were 7,130 dairy producers in GB as of April 2024. Year on year, this is an estimated decline of 440 dairy producers (-5.8%). There was only a minor loss in producer numbers between April 2023 and our last survey in October 2023, meaning the majority of these producers have left the industry over the winter months.

Although milk prices are historically higher, when compared to the peaks in 2022 they have dropped off substantially. This, alongside robust cull cow prices, continued inflationary pressure on key inputs and increased interest rates driving up the cost of borrowing, may have incentivised producers to shut up shop as farm margins tighten. For some producers, increased regulatory pressures (such as NVZ’s and slurry storage) could also have been a driver to leave the industry prior to making long term investment decisions. 

Despite falling producer numbers, milk production in the 2023/24 milk season (Apr 23 – Mar 24) was only back 0.2% year on year. Grass growth was in line or above the 5-year average for most of the season in 2023 allowing good yield per cow for those on grazing. However wet weather interrupted forage production and many cattle were housed earlier than usual and spring turn out delayed, putting pressure on forage and bedding stocks.

Average milk production per farm has seen good growth and according to BCMS data, the GB dairy herd has been flat year on year. This suggests that there has been further movement towards larger farm size over the last 12 months.

Historic data can be found on our producer numbers page.

Why do we carry out the survey?

Getting a true picture of the number of dairy producers in the country is often difficult due to the different reporting methods used.

• The Food Standards Agency (FSA) can be used to track producer numbers across England and Wales, based on the number of farmers registered to produce milk. However, deregistering is voluntary, and therefore unlikely to be top of the “to do” list for a farmer leaving the industry. The FSA will often only capture this cessation when a regular check is carried out. These checks occur on a 10-year basis (for those registered with Red Tractor) or a 2-year basis otherwise. This means FSA numbers will often over-state the number of dairy farmers in the country.
• Defra carry out a survey on the number of dairy holdings across the UK, which returns a figure considerably higher than our estimate. This is because it includes all farms with a dairy cow over 2 years old with offspring. Around a third of those holdings had fewer than 10 cows, meaning they are unlikely to be commercial dairy farms, and would be excluded from our estimate.

Notes

AHDB’s estimate represents the number of producers actively contributing to GB milk production. It is based on the number of active producers and temporary inactive producers from the milk buyers that contribute to the Daily Milk Deliveries survey. This covers approximately 82% of volumes in GB, and so the estimate has been adjusted accordingly.

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