Farming News - Upgraded milk price tool makes it easier to understand impact of system change on farmers’ incomes

Upgraded milk price tool makes it easier to understand impact of system change on farmers’ incomes

06 Dec 2017
Frontdesk / Livestock

Farmers considering a change in production system can see how their cash flow and milk cheque will be affected by using AHDB Dairy’s upgraded online Milk Price Calculator.

Image result for image of ahdb milk price calculator

The enhancements to the Calculator support AHDB’s recently announced ‘Optimal Dairy Systems’ approach, which suggests farmers should focus on either all year round or block calving.

Other improvements make it easier for farmers to adjust elements of their milk profile, such as butterfat content or delivery profile, and see how these changes affect their revenues.

Patty Clayton, AHDB Senior Analyst, says: “The decision for a dairy farm to change system needs careful planning, of which finances and cash flow are a big part. We want to ensure AHDB tools help to simplify the decision and give easily comparable information.”

Most milk buyers pay premiums or apply penalties for seasonal profiles, so there can be a significant difference in cash flows throughout the year for all-year-round (AYR) and block calving systems.

As price variations differ significantly across milk contracts, farmers are advised to run their own numbers through the calculator and use the forecasts as a guide.

The calculator can be used to help you achieve the best milk price possible. By inputting farm-specific data, it provides a way to see where changes can be made to improve the milk price on your current contract.

It also allows for a comparison of prices across a range of contracts, either based on your own specific milk profile or the AHDB Dairy standard litre.

This can be used in conjunction with the Milk Forecasting Calculator to see how changes to herd size, yields or calving patterns will impact your business.

You can find the Milk Price Calculator on the AHDB website at dairy.ahdb.org.uk/milk-price-calculator

You can watch a short video to see how to use it if you are new to the calculator, or read the FAQ’s document, including definition of terms and some common questions and answers.