Despite one of the most expensive winters in recent years and no sign of any real grass let alone increase in the milk price, dairy cattle prices are heading north due to a shortage fresh cows and heifers in the supply chain.

While several centres saw prices peak at the end of last year, Wright Marshall auctioneers at Beeston, witnessed milk cow and heifer values rise a massive £200 and £700 per head on the month, at their March Mid-Month sale, last week.

"Trade was back to that of the autumn, with only seven animals selling for less than £1000," said dairy auctioneer, Simon Lamb, who added that 166 head were forward for the Beeston sale.

"This is the first increase we have seen in values since December and yet there is no sign of any improvement in the milk price or any grass.

"Normally there would be cows out at grass down here by now, but everything is still inside to include the more extensively run cattle," he said.

Mr Lamb pointed out that supplies of fresh females remain tight due to the continued use of beef semen following the last crisis in the dairy sector, and because there are fewer cattle being imported from the continent with the unfavourable exchange rate.

Instead, he pointed out that prices had increased to allow producers to continue milking and pay bills when the past winter had proved extremely costly with all feed prices up on the year.

"People want milk now, and anything with plenty of milk is a joy to sell compared to in-calf heifers which are a similar trade to what they were at the end of the year," added Mr Lamb.

The shortage of dairy replacements is likely to continue for the foreseeable future too, according to Harrison and Hetherington's dairy auctioneer Glyn Lucas, who blamed the worldwide increase in the use of beef semen and sexed semen.

"No-one wants a Holstein bull calf these days, so there is an increase in the use of beef semen and sexed semen. It'll get to the stage that conventional semen will become a thing of the past."

As a result, he said commercial fresh cows and heifers had increased almost £200 per head in the past couple of months with the last Dairy Day sale at Carlisle – staged during the severe snow – levelling at £1323 and £1578, respectively.

"We did start the sale an hour later that day, but considering the weather it was, it's amazing we were able to sell anything. There were only five buyers in the ring to start with, but that increased to 20 by the end of the day."

Pedigree cattle sold at the last club sale met a particularly strong trade with Holstein heifers averaging just shy of £1690, while commercial cows and heifers at £1137.62.

On a more positive note, Mr Lucas said that the milk processors would have to increase the milk price in the next few months, as cows are not milking the way they should be at this time of year due to the snow and the ice.

Furthermore, he said there will not be the same spring flush this year as overall production is likely to be affected by the lack of grass.

"There is no grass anywhere from Cornwall right the way up to Aberdeen, which coupled to the amount of milk that had to be dumped during the bad weather and you would think supplies will be down on the year," concluded Mr Lucas.

Initial estimates from AHDB Dairy suggest around 19m litres of GB milk was lost across four days during the bad weather of February 28 to March 3. Based on AHDB’s daily milk deliveries survey, the worst affected days were March 1 and 2, when around 15m litres remained uncollected.

Most years, the impact of adverse weather of this type is normally relatively localised, with flooding or snow only impacting on roads in particularly badly affected patches of the country. However, the ice and snow in early March was much more wide-spread. As a result, in terms of milk collections, AHDB said this was one of the worst weather-related short-term impacts the industry has seen in recent years, with the loss of milk being around three times the level suffered during the adverse weather in January 2010.

The industry's levy board was also concerned about future milk supplies, claiming that there would be knock-on impact on volumes moving into the spring peak with cows that would normally have been turned out early March, most likely to be worst affected.

Meanwhile, world milk production from the five key exporting regions of the EU-28, Argentina, Australia, New Zealand and the US, which account for more than 65% of global milk production and 80% of global exports of dairy products show January deliveries averaged 796m litres per day, a rise of 2.7% on last year when supplies where actively held back as a result of the EU milk reduction programme.

Most of the key producing regions recorded a year on year increase in production with the exception of New Zealand, which saw a 4.9% drop in deliveries. The main driver behind rising supplies continues to be the EU-28, where January deliveries were up 4.0% on last year.

Within the EU-28, most of the larger producers have seen growth in milk deliveries, including France, Germany, UK, Ireland, Poland, Spain, Italy and Belgium.