From the Farm Gate: Three Dairy Farms Facing an Uncertain Future

Rising costs, volatile milk prices and growing regulatory pressure are reshaping dairy farming. Across three farms in East Sussex, different systems reveal the same underlying challenge — how to remain viable in an increasingly uncertain landscape.

Many UK dairy farmers find themselves caught in a familiar squeeze — milk prices that move quickly, set against input costs that rarely fall, from feed and fuel to fertiliser and labour.

Set against a backdrop of global oversupply, some farms are struggling to meet the cost of production. Prices shift, costs stick, and even the weather becoming harder to read from one season to the next.

For many, the response has been to push for greater efficiency — scaling up, increasing herd sizes and, in some cases, moving towards more intensive systems.

To understand how this plays out on the ground, I visited three family-run farms in East Sussex — all grazing-based systems, but operating at different scales.

Oak Bank Farm, Ashburnham

At Oak Bank Farm, the system is built on a mix of owned and rented ground, spread across a relatively tight area. Around 100 acres sit around the yard, with additional parcels supporting forage, youngstock and dry cows. Like many dairy farms in the South East, it’s a fragmented footprint — but one that still functions as a single unit.

The herd numbers around 150 milking cows, though Louke Van De Meer is clear that fewer would be easier to manage.

“Between 100 and 120 is where it’s comfortable,” he says.

That tension — between what works practically and what stacks up financially — runs quietly through the system. When milk price is strong, output rises. When it falls, the business has to adjust — but dairy is not a tap you can simply turn off.

Cows still need milking, feed still needs buying, and the rhythm of the system carries on regardless of the market.

“We don’t set the price. We take it.”

Margins are shaped not just by the headline milk price, but by how that price is structured and how changes in supply and demand filter back to the farm. Even within a co-operative system, there can be a gap between what the market needs and what a farm is set up to produce.

Costs, meanwhile, continue to edge upwards — fertiliser, labour and infrastructure all narrowing the margin for error.

At this scale, the business carries less borrowing than many larger units — fewer buildings, less infrastructure, and less pressure to service high levels of debt. That, in turn, creates a different kind of resilience: the ability to absorb volatility and adjust more quickly when margins tighten, even if it comes at the cost of total output.

Alongside economics sits regulation, particularly around slurry storage and infrastructure.

“I can’t fight them. I have to work with them.”

For Louke, though, the biggest uncertainty isn’t price or policy — it’s land.

“Our biggest worry is losing ground,” he says.

Burnt House Farm, Waldron

At Burnt House Farm, together with two other units he runs nearby, Joe Delves milks around 600 cows, producing roughly four million litres of milk a year. The cows are grazed outdoors when conditions allow, from spring through to autumn. It is a system built around efficiency: spreading risk, managing output and making the numbers work at scale.

“If part of the business doesn’t make money, it’s a hobby,” he says.

That mindset runs through the operation. Alongside the core dairy enterprise, Joe has developed a separate cheese business — adding value to a portion of the milk, while the main system continues to operate at volume.

Scale brings opportunity, but also complexity. Labour, infrastructure and input costs all increase, and the margin for error doesn’t necessarily disappear — it just shifts.

“It’s a low-margin game,” Joe says. “You’ve got to stack it high.”

Even at this level, the business isn’t immune to pressure. With a cost of production in the mid-40 pence per litre range, and milk prices at times returning mid-30s, the gap has to be absorbed somewhere — often through borrowing or reserves built up in better years.

“It swings fast,” he says. “You can go from a good year to a tough one very quickly.”

That volatility extends beyond milk price — feed, fuel and weather patterns all play a role, making forward planning increasingly difficult.

Feed, fuel and fertiliser — the “three Fs” — continue to drive much of that pressure. At the same time, the business has had to adapt. Fertiliser use has been cut significantly — now running at roughly a third of previous levels — without a dramatic drop in yield.

“You can ride it out for a while,” he says. “But if costs keep rising, it soon starts to bite.”

Recent expansion — including the purchase of an adjoining farm — has strengthened the long-term position of the business, but also adds another layer of financial commitment in the short term.

There is also a sense that future regulation needs to be grounded in how farms actually operate.

“It’s got to be based on evidence,” he says. “What works in practice, not just on paper.”

Like smaller farms, the system remains exposed to volatility. The difference is in how that risk is managed — through output, efficiency and diversification, rather than the ability to avoid it.

Lime End Farm, Herstmonceux

At Lime End Farm, the conversation turns more directly to regulation — and what it might mean for the future of dairy farming.

Matthew Ford runs around 670 cows, grazing approximately 300 acres, with the herd housed over winter, supported by maize and grass grown for feed across a mix of owned and rented land.

Like others, the business is feeling the pressure of rising costs — but it is the direction of policy that concerns him most.

Proposed changes to environmental permitting, which could bring dairy farms in line with pig and poultry units, are seen as a significant shift.

“The biggest threat is the cost of it,” he says.

“You’re paying for someone to come out and inspect the paperwork — it’s just a whole cycle of bureaucracy.”

For Matthew, the issue is not just regulation itself, but where that money is directed.

“You’re spending a whole load of money on compliance, when you could be spending that money on infrastructure.”

There is a concern that these pressures, combined with tight margins, may accelerate structural change within the industry.

“All you’re doing is reducing the size of the industry,” he says. “You’re just going to see offshoring effectively.”

At the same time, land is becoming harder to secure.

“It’s all just increasing demands on land… you can’t just say, I’ve lost 100 acres here, I’ll go 10 miles up the road.”

Faced with that uncertainty, longer-term investment becomes harder to justify.

“Why would you bother investing for the future if you’re not going to make any money?”

Across all three farms, the systems are different, but the pressures are strikingly similar. Margins are tighter, risks are higher, and the room to adapt is narrowing.

The response may vary — from flexibility at smaller scale, to efficiency and output at larger scale — but none are insulated from volatility.

With price, policy and land all shifting at once, the question is no longer just how to improve efficiency, but whether the industry still allows these farms to remain viable at all.