The New Butterfat Adjustment Rules
The New Butterfat Adjustment Rules
In previous years, EC rules required us to compare the UK totals of (volume) wholesale deliveries and butterfat-adjusted wholesale deliveries. The result of the comparison at national level affected individual producers' butterfat-adjusted delivery figures. Initially, this was by 'triggering' the butterfat adjustment, or not; from 2004/05 the concept of ‘triggering’ the butterfat adjustment was replaced by the scaling back of downward adjustments if necessary, until the sum of the downward adjustments equalled the sum of upward ones. The scaleback measure has now been abolished, so a producer's butterfat-adjusted delivery figure is no longer affected by the national position. In addition, the coefficient used to calculate upward adjustments has been halved.
The EC quota regulations set out how the delivery figures should take account of butterfat. The rules say that:
- Every wholesale purchaser must compare the average fat content of a producer’s deliveries with his (ongoing) butterfat base.
- The producer's volume delivery must be adjusted up by 0.09% for each butterfat point (0.01%) by which the fat content exceeds the butterfat base. If the fat content is less than the butterfat base, the delivery figure must be adjusted down by 0.18% for each butterfat point.
- Each purchaser will thus have a volume delivery figure and a butterfat-adjusted delivery figure for each of their supplying producers.
- The purchaser must inform the RPA of the volume delivered and average fat content for each producer who has supplied them during the quota year. They must also supply totals of volume and butterfat-adjusted deliveries, i.e. a figure for the total volume of milk they have purchased, and a figure for the total of their producers' butterfat-adjusted delivery figures.
- The RPA will use each producer’s butterfat-adjusted delivery figures in calculating the UK levy, inform purchasers of their producers’ levy liabilities and invoice the purchasers for the total levy owed by their producers for deliveries to the purchaser during the quota year.
Under the new regulations, butterfat adjustments will always be applied to producers who deliver milk with a fat content that is different from the butterfat base of their quota.
Examples
 | Volume Deliveries | Fat Content | Butterfat Base | Adjusted Deliveries |
| Producer A | 100,000 | 3.99% | 4.00% | 99,820 |
| Producer B | 100,000 | 4.01% | 4.00% | 100,090 |
Page published: 21 May 2012