The size of the dairy herd in Britain has decreased by 2% over the past year, the biggest annual drop in the last four years, according to the AHDB.
Analysing data from the British Cattle Movement System it says there were 1.80m dairy females over two years as of July 1, 2016, down 37,000 head from a year earlier. Cullings of dairy females (36 months +) over the same period rose 13% to 37,000.
The AHDB says while cullings have been increasing steadily since the middle of 2014, the rate accelerated at the beginning of 2016. The increase has predominantly affected the number of cows in the early lactation years.
The net decline in the milking herd suggests that those being culled are not being replaced by young stock.
In the short term, this could mean production will be lower, the AHDB says however, the number of young stock is still 15,000 head higher than last year and almost 60,000 head higher compared to four years earlier.
As a result, it says the potential to increase milk production through an increase in the milking herd still exists.
According to the most recent DEFRA figures, the average UK farmgate price stood at 19.85p/L (22.90c/L) in June. This was a 0.47p/L( (0.54c/L) or a 2.3% decrease on the May average price.
The June 2016 price was 3.90p/L (4.49c/L) or 16.4% lower than the same month last year.
The Northern Ireland (NI) average for June was 17.54p/L (20.23c/L), a decrease of 0.7% compared with May. The June price was 2.49p/L (2.87c/L) or 12.5% lower than the previous year.
