DAIRY farmers must take control of their own businesses and either quit at the earliest chance or remain and seize the opportunities to add value to milk and meet consumer demand.

Those were the key messages at the Royal Association of British Dairy Farmers national dairy conference staged in Cheltenham, in association with the Milk Development Council.

"Mid-term review will lead to a fall in milk price in the order of 2.7ppl in England, and nearer 2ppl in the rest of UK, and the marketplace will become more volatile," said Kite's John Allen.

A 100-cow herd averaging 7,000 litres on 200 acres would be £5,000 down by 2007, and £14,000 down by 2010. A 100-cow tenanted unit with a value of £176,000 in 2002 could have fallen to £75,000 by 2006.

"Farmers have just two years to sort themselves, make a business plan and adjust before the cuts start to bite."

Kevin Bellamy of the Milk Development Council said farmers had four clear-cut options. "You can increase turnover, increase efficiency, adopt alternative income streams or cease production," he said. "However, in the first instance you must know your current business position before any strategic decisions can be made."

Speakers from New Zealand and Poland indicated that they would be players in the European market but international marketing strategist Paul Fifield argued that MTR would bring massive opportunities for British farmers.

"You'll be free to produce what the market needs," he said. "You are on a death wish unless you take the market by the scruff of the neck and extract serious money by supplying high-value differentiated dairy products, the majority of which are currently imported."

* The National Beef Association has called on Defra to use the moorland line as the split for the single farm payment scheme.

Defra's proposal to use the severely disadvantaged line as the boundary would result in many mixed beef and sheep farms in the SDA fringes suffering severe cuts in income.

Robert Forster, NBA chief executive, points out that the European Commission has already said the moorland line should be the boundary used.

Defra's decision to introduce higher and lower single farm payment zones might have prevented grouse moor owners and the most extensively managed hill sheep farms enjoying a windfall flat rate payment of about £185/ha in 2012, but its poor choice of boundary line would mean vast tracts of the most remote and lightly-farmed land picked up £75/ha.

In many instances this would let the biggest hill farms, with 1,300ha or so in hand, receive about £100,000 a year and estates with 2-3,000ha of grouse moor to get £150,000-£225,000.

At the same time mixed cattle and sheep farmers in the SDA fringes would struggle to hold their environmentally important businesses together because they faced support cuts of 55-75pc, said Mr Forster.