How are prices affected by calving systems?

Published 3 October 17

As part of our new approach on optimal dairy systems, we have looked at the impact on milk prices of the different production profiles of all year round (AYR), spring and autumn block herds. This is to help farmers better understand the revenue aspects of operating a block calving system.

It must be noted that the results do not take into consideration the production costs associated with each of the systems. Farmers are advised to look at both costs and revenues to assess the net impact of changing or adapting systems on their margins.

Data run through AHDB’s Milk Price Calculator* (MPC) on a selection of milk contracts shows how prices achieved on block calving systems differ from those paid on AYR systems.

Seasonality payments mean typical autumn block calvers achieve slightly higher prices than both AYR and spring block calving systems, regardless of the type of contract. Generally however, the gains are relatively small.

Meanwhile, penalties for spring milk mean spring block calving herds would receive lower prices than the other two systems when looking just at the impact of the timing of milk deliveries. However, the compositional quality of spring block herds tends to be higher than AYR or autumn block. When accounting for on the higher solids content, there is a marked improvement in prices for spring block systems regardless of type of contract.

The impact of changes to the distribution of milk deliveries through the year, combined with the resulting changes in constituents can have a significant impact on the milk price paid. As such, farmers should run their own numbers through the MPC.

Milk Prices By System

*Based on typical AYR, spring and autumn block calving production profiles using July pricing schedules

^Adjusted for changes in butterfat and protein