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Analysts warn of a coming ‘tsunami of milk’

08 March 2016

Dairy analysts have warned of a “tsunami of milk” this summer due to massive oversupply in the market.

The removal of milk quotas last year has meant that there could be an extra 1.2 billion litres of milk being produced this year, market analyst Chris Walkland said.

That’s the equivalent of 45,500 tankers full, or 400 miles of tankers stretching from Edinburgh to London.

“It’s going to be pretty horrendous over the next three months,” he told delegates at a dairy update session at National Farmers Union Conference in Birmingham late last month.

He said that the spot price of milk could drop as low as 10p a litre. Farmers need to be paid 28-30p a litre to cover the cost of production.

Meanwhile Dairy UK Chairman Dr David Dobbin wrote to Farming Minister George Eustice to urge the UK market to find an outlet for the oversupply of milk. 

"Despite depressed returns, the growth in global milk production, especially from Europe including the UK, is still rising and running well ahead of global demand,” he said. 

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