The 2011 DairyCo Farmer Intentions Survey shows that there has been a slight dip in GB dairy farmer confidence, with 13% planning to leave the industry in the next two years, compared to 9% in the 2010 survey.

Milk prices and input costs were the greatest concerns to GB dairy farmers, but the survey showed some less expected statistics about milk contracts.  "In this year's survey we questioned dairy farmers about their opinion of their milk contracts, to get an understanding of how this may influence their future intentions," says Matt. "Only a small percentage of dairy farmers cited milk buyer contracts as a major threat or challenge. A majority of farmers, 54%, were happy with their contract, although 56% highlighted milk price as a major concern.  This may indicate that dairy farmers do not connect milk price and contracts as interrelated issues."

"There are also some interesting characteristics when looking at industry expanders. Those farmers seeking to increase production differ in their characteristics compared to the total industry sample."

For instance, expanding farmers are more likely to:

• Be in younger age groups: 69% of those under the age of 30 are intending to increase production, compared to 23% of over 60s.

• Have a successor: 73% of those farmers intending to increase have a successor.

• Have a solely dairy enterprise: 71% of those farmers intending to expand have a solely dairy enterprise compared to 29% of mixed farmers.

The overall picture is less positive, with just over 50% of dairy farmers expected to maintain their production at current levels over the next two years; the survey estimates that GB milk production could fall by up to 4% within the next two years.  However, results from previous surveys show that the actual effects on production has often been less than predicted.

Only 6% of GB farmers surveyed in 2011 plan to invest more than £250,000 over the next five years.  This represents a three percentage point drop on last year.

"With 13% of farmers intending to leave the industry, there is a concern that GB will stand to lose milk production capacity if there is not sufficient investment," says senior analyst Matt Johnson.

The full survey can be downloaded from the DairyCo website here.The 2011 DairyCo Farmer Intentions Survey shows that there has been a slight dip in GB dairy farmer confidence, with 13% planning to leave the industry in the next two years, compared to 9% in the 2010 survey.