The price at which clean milk quota is traded, a key indicator of producer confidence, has slid by 1ppl over the last four weeks to 19.5ppl, says quota broker Ian Potter. During the same week last year, the rate was 34.5ppl. This 40% plunge in the space of a year is costing producers dearly if they want to leave the sector and salvage working capital as they go. The Intervention Milk Price Equivalent, used by processors as a negotiating chip, has slid steadily as sterling has strengthened. It is languishing at 15.362ppl, down 2.4ppl on this time last year. A 3p fall in the euro approximates to a 1p drop in the IMPE. The euro is currently worth just over 58p. "So if the euro was at 0.7927, where the IMF has indicated it thinks the UK should aim to join, then the 21ppl difference is equivalent to a 7ppl increase in the IMPE to 22.36ppl!" said Potter. {{PROVISIONS }}

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