The effect of changes in the payment scheme on individual farmers

Extract

The changes in the payment scheme proposed by the Milk Marketing Board from 1 April 1984 cover a number of issues relating to compositional quality, seasonality of pricing and the monthly distribution of production. Although the changes in total must be financially self-balancing on a national basis, the effect on individual farms may be significant.

A computer program has been used on the records from a number of farms to investigate the effect of the changes, separately and together, on annual and monthly income from milk. The effects on three herds were as follows.

Herd 1 was a Jersey herd that showed an overall increase in income per cow, due mainly to the higher price of protein. Herds with a high protein to lactose ratio in the milk will stand to gain from the new price of protein.

Herd 2 was a Friesian/Holstein herd with a low protein and low milk fat content in the milk. The herd was also calving seasonally and had a low output of milk during August and September. A substantial decrease in income of approximately £29 per cow was due principally to the low protein to lactose ratio but also to the low fat content and the seasonal pattern of milk production on the farm.