Milk Price to Feed Price Ratio – Charles Holt (Lincoln)

AHDB regularly report on the milk price to feed price ratio (MFPR).  This shows the relationship between milk price and feed price, which is vital as purchased feed costs are by far the largest variable cost on most dairy farms.  Clearly, they are looking at a UK average, but nevertheless, the ratio gives a strong idea of the trend in dairy profitability.

Source: Milk to Feed Price Ratio (MFPR) AHDB

So, what has been happening lately?  The long term (five year) average of this ratio is around 1.25.  This ratio compares the price of milk per litre with the feed price per kilogram.  The fall in April and May has been to 1.12.  This is despite a milk price rise – for most producers – which is encouraging.  But feed prices are rising much more rapidly, and just confirm the importance of the message that making the most of your forage is absolutely crucial to the furtherance of the success of your dairy business.   

Most milk producers can do little or nothing to influence your milk price.  So, while it provides a continuously fascinating topic of discussion, it is rare that a lot can be done to increase it (unless you are significantly changing your calving pattern for instance, in which case it is a much bigger issue).

But you can do something about your feed costs.  Are you absolutely sure you cannot reduce them, and feed your cows more efficiently?  Are you getting a top 25% figure for production off forage?  Can you target a top 10% level of achievement?  Now that could be a challenge to take up for your business.  Contact Charles at charlesholt@fcgagric.com or your local FCG Office, to see how you can improve your milk from forage.