The British dairy industry, the third largest in Europe, has always prided itself on its ability to service the large liquid milk market in the UK. Imports are unknown, other than a small amount of organic and long-life milk, and the market has always been supplied from domestic sources.

So it came as something of a shock when Sir Stuart Hampson, chairman of the John Lewis Partnership and president of the Royal Agricultural Society of England, said Waitrose would be forced to import liquid milk within five years because of declining domestic milk production.

He rightly described this as scandalous but perhaps his view was coloured, in that he has recently sold his own dairy herd in Buckinghamshire. His claims of a looming milk shortage bear closer examination.

Production of cows milk in the UK amounts to 14,000 million litres a year. Some 47% of this is used to produce liquid milk, with the balance used for butter, cheese and other products. On the face of it there is plenty of milk to meet consumer demand for liquid milk.

Looking a little more deeply, however, milk production follows the seasons, peaking in May and hitting its trough in November, when daily output is about 17% lower than in May. But demand for liquid milk is almost flat throughout the year, apart from a drop-off during holiday seasons. This means the industry has to produce enough in the trough to meet all demands. With November liquid milk demand about 550 million litres against milk output of 1,000 million litres, it does this reasonably comfortably.

For demand to exceed supply of liquid milk, production would have to fall 20%-30%. An average of one dairy farmer quits every day, but many others are expanding their herds. Overall, the balance is on the quitting side, with milk production falling over the past three years at a rate of 1% to 2% a year because of the squeeze on profitability. So while there is some cause for concern for the future of milk supplies, output would have to drop much more rapidly before there was room for imports.

Mike Bessey