Inside: Dairy Market
Indicative milk price continues to fall
The indicative milk price in February falls below €30 per 100 kilos. It concerns the milk price based on butter and milk powder (at 4% fat). Especially fat should support the milk price and that gives hope for the month of March.
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The price of protein moved sideways over the month of February, according to figures from the German Nutrition Economic Institute (IFE). This is at a valuation of 132,2 cents per kilo for skimmed milk powder, which translates into a stable 9,3 cents per kilo of protein. In recent weeks, protein has been on a declining trend, which is caused by older product with a lower market value.
For butter, lower quotations were on the plates for the month of February. For example, the butter price drops to 437,4 cents per kilo, one month earlier the price was 1 cents per kilo. This means that the fat price falls from 476,8 cents per kilo to 21,3 cents per kilo.
Decrease in milk price ex-farm
The minus in the fat and the stable price for protein translate into a milk price (ex farm) of €27,30 per 100 kilos. It is a minus of €1,90 per 100 kilos and the fifth decline in a row. A rebound in the fat price at the beginning of March gives rise to hope that the decline has come to an end.
At the Milk Forum in Berlin, opinions about the trend in the milk price differed. The majority are concerned, because of the pluses in milk supply (in the European Union and beyond). However, no further crisis is expected in 2018.
The fat prices are decisive for the milk price.