Spoiling supplies: The weak pound is likely to increase feed costs and weigh on margins

Industry operators raise and breed dairy cattle to produce and sell raw milk. Over half the milk produced in the United Kingdom is sold as liquid milk, with the majority of the remaining milk used for products such as cheese and yoghurt. The past five years have been challenging for the industry. Volatile dairy prices, increasing production costs and growing pressure from supermarkets and dairy processors have weighed on industry performance. Dairy farmers are highly dependent on the domestic price of milk, which increased significantly at the start of the period. However domestic prices fell for majority of the five-year period, which caused industry revenue to decline. The ending of the EU milk quota in June 2015 adversely affected the industry's performance...read more.

Industry Statistics & Market Size
Revenue
£4.2bn
Annual Growth 13-18
1.0%
Forecast Growth 18-23
Profit
Employment
38,708
Businesses
12,129
Market Share of Companies
There are no companies with a dominant market share in this industry

Industry Threats & Opportunities

  • The increase in the domestic price of milk is expected to support short-term revenue growth
  • The growing adoption of automated milking processes has significantly improved efficiency
  • As more operators join producer organisations, their bargaining power is likely to improve
  • Industry Report - Starting a New Business Chapter

    The barriers to entering the Dairy Cattle Raising industry are relatively low. The main barriers that potential entrants face is finding suitable land to accommodate cattle. Every cow requires a significant amount of good-quality grass for grazing, which often requires a large area of land and leads to relatively high rent costs. Grass quality is affected by the amount of rainfall and other climatic conditions (for example, heavy snowfall will reduce grass quality). Areas that reliably yield a large supply of good quality grass will be more expensive to rent or purchase.Potential entrants will also need to purchase enough cattle to create a profitable herd. Dairy cattle are expensive, given the high returns each can provide. The...purchase to read more.

    Additional Insights for the Dairy Cattle Raising Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Dairy Cattle Raising Industry are

  • Appropriate climatic conditions
  • Prompt delivery to market
  • Output is sold under contract - incorporate long-term sales contracts
  • IBISWorld analysts also discuss how external factors such as Domestic price of milk and Liquid milk consumption per capita in the Dairy Cattle Raising industry impact industry performance..

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    What's in this report

    What is the Dairy Cattle Raising Industry?

    Farmers in this industry raise and breed dairy cattle to produce and sell raw milk to processors and manufacturers. The processing of raw milk and cream is excluded from the industry.

    Industry Products
  • Dairy cattle sales
  • Milk for processing
  • Milk for liquid consumption
  • Industry Activities
  • Producing raw milk
  • Raising dairy cattle
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Domestic price of milk
  • Liquid milk consumption per capita
  • Animal feed prices
  • Demand from butter and cheese production
  • Level of annual rainfall

  • Current Performance
  • Oversupply and competition
  • Poor prices
  • Producer organisations
  • Milked margins
  • Chart: Revenue Growth

  • Industry Outlook
  • Future funding
  • After the exit
  • Herding in the right direction
  • Susceptible to supply
  • Table: Dairy Cattle Raising Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Dairy Cattle Raising Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Milk & Cream Production
  • Butter & Cheese Production
  • Yoghurt & Other Dairy Product Processing
  • Consumers

  • Key Selling Industries
  • Agricultural & Forestry Machinery Manufacturing
  • Animal Feed Production
  • Veterinary Services

  • Products & Services
  • Milk for liquid consumption
  • Milk for processing
  • Dairy cattle sales
  • Chart: Dairy Cattle Raising Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Muller UK & Ireland Group
  • Arla Foods Ltd
  • First Milk Ltd
  • Other cooperatives
  • Chart: Major Market Segmentation for the Dairy Cattle Raising Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
    ProfitPurchasesWagesRentDeprecationUtilities and other costs
  • Chart: Cost Structure Benchmarking – Sector vs Dairy Cattle Raising

  • Basis of Competition
    Barriers to Entry
  • Table: Barrier to Entry Checklist for the Dairy Cattle Raising Industry

  • Industry Globalization
    There are no major players in this industry. This report includes analysis of other companies.
    Capital Intensity
  • Chart: Level of Capital Intensity for the Dairy Cattle Raising Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Dairy Cattle Raising Industry
    Includes:
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Wages (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Automatic Milking Systems
  • Machinery that milks cattle without much human input.
  • Farm-Gate Milk Price
  • The price dairy farmers receive for raw milk.
  • Milk Quotas
  • EU regulation designed to protect farmers and cap milk production across Europe. The quotas expired on April 1 2015.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Dairy Cattle Raising market research report provides the latest industry statistics and industry trends, allowing you to identify the products and customers driving revenue growth and profitability. The industry report identifies the leading companies and offers strategic industry analysis of the key factors influencing the market.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Dairy Cattle Raising:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Dairy Cattle Raising market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Dairy Cattle Raising, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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