UK Dairy Oversupply Leads to Increased Milk Disposal by Freshways

In the United Kingdom, Freshways, a leading dairy processor, reported that it was forced to dispose of surplus milk during the Christmas period due to an oversupply crisis. The company revealed that the abundance of raw milk led to the necessity of physically pouring it away, underscoring the severe supply-demand disconnect within the British dairy industry.

The current situation reflects a broader issue where UK dairy producers and processors are facing challenges with production volumes exceeding processing capacities and retail demand. This oversupply has resulted in milk waste, which is an extreme measure usually taken only in acute situations of excess supply.

Industry experts note that this milk disposal has financial implications, as it represents a loss of product and affects margins for processors and their suppliers, especially as wholesale prices soften and farmgate returns diminish. The trend of high deliveries fr om the UK dairy herd has exacerbated the pressure on processors, forcing them to make difficult operational decisions to balance supply and capacity, sometimes resulting in milk waste.

The situation at Freshways is indicative of wider market imbalances across Europe, wh ere milk production continues to surpass demand. This has led to lower commodity values and price reductions by processors, adding further stress to the dairy value chains.

Freshways' milk disposal exemplifies the dramatic impact of oversupply on pricing, waste, and future production planning, highlighting the challenges faced by dairy producers and manufacturers in managing supply chain dynamics.