News

June 08, 2009

Bad News Continues From The UK’s Dairy Industry

By Sally White

After yet another rise in shipping markets and a forecast of more rises to come was given by broker Breamar Seascope because of record purchases by China in the last two months. By the year end, however, it predicts that prices will fall as new vessels are delivered. In the medium term, Tony Pegum, managing director of Braemar Seascope, told a conference in Bali, Indonesia, that he believed the freight market would be weak for the next three years before recovering on the strength of Indian and Chinese economies. “There will be an oversupply of vessels in 2010”, he said. The Baltic Dry Index, a measure of shipping costs for commodities, matched its longest winning streak in more than two years, rising 12 per cent to 4,106 points.

Continued bad news from the UK dairy industry was the appointment of receivers at Dairy Farmers of Britain (DFOB) which employs 2,200 people and is responsible for 10 per cent of UK milk production. DFOB is an agricultural cooperative with 1,800 member farmers who supply over one billion litres of milk a year. It has struggled to pay its member farmers a competitive price for their milk and large numbers of them have been resigning. DFOB has lost the milk contract from Co-operative...