The latest sale of skimmed milk powder (SMP) out of intervention has all but cleared out stocks, leaving only 6 per cent of the total left to sell. Over 80,000 tonnes of the remaining stocks were accepted as sold at the 8 January tender, bringing the total product sold to date to nearly 358,000 tonnes.

With significant volumes of product shifted over recent months, an estimated 22,000 tonnes will be available for the next tender on 5 February, making it very likely that stocks will be cleared in the next tender.

Buoyed by the now-dwindling intervention stocks, the overall Global Dairy Trade (GDT) Price Index rose by 4.2 per cent at the latest auction on Tuesday.

The auction index has now recovered more than half of the losses sustained between May and December last year, when it lost 20% of its total value following 13 successive price drops.

Despite that good news, First Milk announced yesterday that following on from a 0.75p per litre (ppl) drop in its January milk price, it will reduce its member milk price from 1 February by a further 0.25ppl to 27.5ppl for the liquid standard litre (4% butterfat and 3.3% protein). This equates to 28.43ppl on a manufacturing standard litre (4.2% butterfat and 3.4% protein).

Commenting on the announcement, Jim Baird, vice chairman and farmer director said: "The impact of downward pressure in the markets during the latter part of last year has taken longer to influence cheese markets than some other commodities, and it is that lag which has resulted in the milk price reduction for February.

"Hearteningly, dairy markets have recovered in recent weeks, and there are signs of more stability ahead. The uncertainties over Brexit continue, however, so it is too early to predict what will happen with milk prices.

"We remain focused on delivering as much stability as we can - something reflected in the scale and timing of our recent milk prices movements. As we look to the year ahead, we are concentrating on delivering growth to deliver dairy prosperity for our members."

Market round-up

Messrs Craig Wilson Ltd had 759 prime hoggs forward at their weekly sale in Newton Stewart yesterday when nice handy-weight hoggs were dearer on the week, but fatter, heavier-types definitely cheaper. Top prices on the day were £90 per head and 216.7p per kg with the overall average levelling at 182.4p (-2.6p on the week).

Cast sheep were also cheaper on the week with 125 heavy ewes selling to £97 for Texel crosses and averaging £61.44, while 91 light/export-type ewes peaked at £45 for Blackfaces and levelled at £45.