AHDB V PTF and a £200 tonne difference conundrum
Posted on: 02/09/22
Earlier today Ian was pointed in the direction of a whopping £200 tonne difference between the traded price of Mild Cheddar quoted by the two industry analysts for August 2022.
The monthly prices over recent months have seen AHDB regularly lower than PTF but for August that gap has unexplainably widened from £50 tonne to a whopping £200 tonne.
May June July August
PTF 4700 4790 4900 4900
AHDB 4650 4740 4740 4700
Since 2015 prices have never dropped in Summer indeed in 2016, 2017 and 2018 they increased.
Ian has spoken to both analysts (AHDB plus PTF/Chris Walkland) to find out how this is possible as well as seeking an explanation as to why AHDB’s August price dropped.
Both agree stocks of mild cheddar are every low and trades are lower than normal.
Given there are only really around six significant cheese traders who account for 90% plus of trades it’s a conundrum as to how the difference is so wide. Does it matter to farmers, yes it does because these prices are used by many as reference prices.
It was suggested by one cheese processor that AHDB had included some cheap imported Continental traded mild cheddar. They say not.
Ian has also concluded that two of those six mild cheese processors/traders claim they have not received calls from AHDB asking about their trades and that they were at £4900 and that they wouldn’t drop prices given their low stock, milk volumes down, farmgate milk prices having to increase as well as the Irish hitting their out of season period.
AHDB did say that two of their traders reported sales under £4700. Simple maths confirms that for everyone at 4,900 there must be one at 4,500 in order to get an average of £4,700.
It’s an unbelievable conundrum to our cheese traders which needs to be bottomed out quickly.