How to navigate the perfect storm in dairy

Understanding milk price volatility

Since autumn 2025, milk prices have fallen sharply, with Chris Walkland describing it as “the biggest drop in milk prices over a short period of time in history.” Prices slipped from the mid-40p range down towards the low-30s, largely due to a surge in global milk production. Favourable weather, strong cow health and relatively low feed costs have combined to increase output not just in the UK, but across Europe, the US and New Zealand.

What’s driving global dairy markets

This is not just a UK issue. Global supply has outpaced demand, with all major producing regions seeing strong output. But there are regional differences and, in the South West, improved processor planning and tighter production has reduced surplus product, helping to support the market.

Early signs of recovery

And there are early signs of change. Commodity markets have begun to firm, with tighter supplies and stronger export demand starting to influence prices. Chris notes buyers are chasing the manufacturers for supplies the manufacturers don’t have, which is beginning to push prices upwards. While this may not yet be fully reflected in the South West, it offers cautious optimism for the months ahead.

Managing rising costs on farm

On farm, the Courtiers highlight how quickly conditions can shift. While the initial drop had limited immediate impact, rising dairy farming costs are now starting to bite. “We really need to start sharpening the pencil,” Christopher explains, pointing to diesel, feed and fertiliser as areas requiring close attention.

Building dairy farm resilience 

Rather than reacting suddenly, the Courtiers’ approach has been to build dairy farm resilience over time. Investment in solar, heat recovery and slurry management has helped reduce reliance on bought-in inputs, while benchmarking through discussion groups keeps spending in check. As their consultant advises, “you must go and get three quotes”, a discipline likely to slip during stronger periods but critical when margins tighten.

Balancing feed, output and margins

A central theme throughout the discussion is the importance of understanding cost of production. The milk to feed price ratio remains relatively favourable, meaning it has still paid to feed cows, but this creates a challenge. Cutting back too far risks reducing output and income, leaving farmers balancing short-term savings against long-term performance.

Navigating dairy market uncertainty with confidence

Looking ahead, all guests stress the importance of professionalism and mindset. Today’s dairy farmers are running complex businesses in a global market, where volatility is unavoidable. Chris believes those who remain are “professionals and they know what works”, while George emphasises the need to “look five, ten years down the line” rather than only focusing on immediate pressures.

Looking ahead and planning for the long term

Despite uncertainty, there is a shared sense of confidence in the sector’s future. Periods of lower prices can still present opportunity, whether through efficiency gains, business development or careful expansion. As Christopher reflects, “you’ve got to keep moving.”

The message is clear. Focus on costs, build resilience and keep an eye on the long term. By staying proactive and adaptable, dairy businesses can be better placed to manage milk price volatility and come through periods of uncertainty in a stronger position.

Episode showstoppers

1.      As business owners, farmers can’t stand still and change is something they need to embrace, making sure a business is agile and ready to move.

2.      Farmers can be professional and love their businesses at the same time, focusing on the detail of producing a product efficiently.

3.      Look out and look ahead, getting off the farm to gain fresh perspective and fresh ideas.

Listen to the full episode below - also available via Spotify and Apple podcasts.

About our guests

Chris Walkland is a well-known independent dairy commentator, having started his career as an agricultural journalist. Moving into the dairy industry, he specialises in dairy markets, producing a market report every fortnight for the Provision Trade Federation.

Brothers Christopher and George Courtier farm on the edge of Dartmoor converting from beef and arable to dairy in 2018, moving three years ago to an autumn-block grazing herd. With their parents, they were named Overall South West Farmer(s) of the Year in 2025.