Hundreds of dairy farmers have quit the industry this year due in part to declining farmgate milk prices, AHDB's latest survey shows.
In the survey of major milk buyers, it is estimated that there were 7,500 dairy producers in Britain as of October 2023.
Year-on-year, this is an estimated decline of 350 dairy producers (-4.5%), although no change reported from AHDB's previous survey in April.
A major driver in the fall has been farmgate milk prices. In September, the UK average milk price stood at 36.36ppl, a drop of almost 13ppl compared to last year.
Paired alongside this, despite inflationary pressure on key farm inputs easing, farm costs such as energy, fuel, feed and fertiliser remain historically high.
Freya Shuttleworth, AHDB's senior analyst, said this had resulted in the tightening of farm margins.
"Average milk production per farm has grown year on year but remains steady compared to volumes calculated in April this year," she noted, adding this indicated a shift towards larger farms.
"In addition, with high milk prices in the latter part of 2022, many farms pushed their cows for increased yields to maximise benefits.
"However, as 2023 has progressed, farms have been focused on improving efficiency and reducing on farm costs."