EU milk price rise slows down

Milk price trend has stag­nated de­spite fall­ing milk de­liv­er­ies across Europe

Irish Examiner - Farming - - NEWS - Stephen Cado­gan

Eu­ro­pean milk prices in­creased for the fifth con­sec­u­tive month in Septem­ber, but the in­crease has be­gun to level off, ac­cord­ing to the mon­i­tor­ing by the Dutch LTO farmer or­gan­i­sa­tion of prices paid to farm­ers by 17 milk pro­ces­sors.

Only a few lim­ited price in­creases have been an­nounced for Oc­to­ber, and in Novem­ber, most milk prices will re­main the same, ac­cord­ing to LTO. Fries­land­camp­ina, the EU’S third big­gest dairy, will fol­low a price in­crease in Oc­to­ber by re­duc­ing the milk price in Novem­ber by €0.70 per 100kg (which the com­pany says is mainly due to pres­sure on dairy prices).

Dairy Crest in the UK will hold the milk price un­changed for Oc­to­ber and Novem­ber, and has an­nounced a price floor for De­cem­ber and Jan­uary.

Out­side Europe, New Zealand’s Fon­terra has low­ered the milk price fore­cast for the cur­rent year, but milk prices are ris­ing in the US. On Tues­day, the Global Dairy Trade (GDT) price in­dex fell 2%.

This in­cluded the ched­dar price fall­ing 4.6% and the but­ter in­dex down 1.7%. But the skim milk pow­der price in­dex gained 1.2%.

It was the sixth con­sec­u­tive drop in GDT prices.

In the EU, but­ter prices are now more than a quar­ter lower than two months ear­lier.

How­ever, the sale of a large quan­tity of in­ter­ven­tion skim milk pow­der in mid-oc­to­ber ap­pears to have cre­ated a floor in that mar­ket. Eu­ro­pean prod­uct is still too ex­pen­sive for the world mar­ket, where New Zealand and South Amer­ica are more com­pet­i­tive.

The milk price trend has stag­nated in Europe de­spite Au­gust milk de­liv­ery fig­ures show­ing clear con­se­quences of the sum­mer drought. In Ger­many, there was hardly any growth in the milk sup­ply, and the milk vol­ume de­creased slightly in France, Italy and the UK.

While there was a strik­ing re­cov­ery in Ir­ish milk de­liv­er­ies, the Dutch milk sup­ply has fallen sharply in Au­gust and Septem­ber as the in­tro­duc­tion of phos­phate rights bites, forc­ing many dairy farm­ers to de­crease their num­ber of cows. Out­side Europe, there is still growth in milk pro­duc­tion, led by New Zealand’s milk vol­ume in Septem­ber ad­vanc­ing to 6% ahead of Septem­ber, 2017. Vol­ume also in­creased in Ar­gentina, New Zealand, Uruguay and the US.

But milk pro­duc­tion fell for the third month in a row in Aus­tralia. Mean­while, milk pro­duc­tion growth in the US is stay­ing below the long-term an­nual growth rate of 1.6%, through Septem­ber.

Pic­ture: O’gorman Pho­tog­ra­phy

Don Crow­ley, Tea­gasc, ad­dress­ing dairy farm­ers at the Tea­gasc/an­i­mal Health Ire­land/tip­per­ary Co-op Cellcheck event on the Crowe fam­ily farm at Bal­ly­husty, near Tip­per­ary Town.

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