Input costs increasing faster than farmgate price

Published 9 December 10

The Defra farmgate price showed another increase in October to average 25.62ppl for the month.  This is 4.8% (1.18ppl) higher than at the same time last year when it averaged 24.44ppl.

Although there has been an increase in the average milk price, the purchasing power of a litre of milk has dropped considerably over the past year as there have been some comparatively larger increases in input costs.  Feed wheat prices have been particularly volatile in 2010, and have recently reached highs comparable to those seen in 2007.  Prices quoted in October for feed wheat were £158/tonne which was 47.7% higher compared to the October 2009 price of £107/tonne.  Annual comparisons of UK produced AN fertiliser prices show an increase of £81/tonne (43.5%) while average UK diesel prices have increased by 15.1ppl (14.2%) over the same period.