UK milk production falls 4% as rising costs squeeze farmers’ margins

Milk deliveries to processors in Great Britain totaled 1.053 bln litres in October 2026, down 4% compared with the same month last year. According to the Agriculture and Horticulture Development Board (AHDB), average daily milk deliveries reached 33.97 mln litres, ranging from 33.21 mln to 34.42 mln litres during the month. Despite the year-on-year decline, October volumes remained 1% above the five-year average.

Between April 1 and October 31, 2026, British producers delivered a total of 7.45 bln litres of milk for processing. According to AHDB’s forecast, total milk deliveries in the 2026/27 milk year could decline by 284 mln litres, or 2.2%, to 12.74 bln litres. The main factors behind the weaker production outlook are falling farmgate milk prices and rising production costs, which are significantly squeezing dairy farm margins.

Producers are also facing additional pressure from higher feed, energy, fuel and fertilizer costs. Disruptions to global feed supply chains caused by russia’s war against Ukraine, along with continued instability in the Middle East, are adding to farmers’ expenses. Meanwhile, prolonged summer drought conditions in Great Britain have reduced forage availability and pushed up prices for straw and other roughage in many regions.

Favorable spring weather supported good yields and quality of first-cut silage, but the hot and dry summer worsened the outlook for winter feed supplies. Relatively mild and dry autumn conditions allowed farmers to continue making silage into October and November, helping to partially replenish stocks. However, the nutritional value of later cuts may be lower and more variable. A strong El Niño poses an additional risk to feed markets, potentially affecting global feedstock prices.

The dairy production outlook is also being affected by declining cow numbers and limited availability of replacement youngstock. Bluetongue remains another challenge, although vaccination uptake among dairy producers is reportedly high. From January to October 2026, cumulative cow slaughter was 2.8% below the same period last year, although slaughter numbers have increased in recent weeks. Together, these factors raise the risk of a further decline in Great Britain’s milk supply.

Tags: UK, Milk, dairy products