Inside Milk
Milk prices show modest increase
Milk prices have been rising this year, although those increases are modest for the time being. Prices are also rising outside the European Union.
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The average basic milk price in the Netherlands increased by €0,17 to €34,45 per 100 kilos in October. However, the increase is somewhat slowed down by FrieslandCampina's guaranteed price, which fell last month, although that reduction was wiped out again in November. On the other hand, increases were visible at A-ware, Bel Leerdammer and Vreugdenhil.
It is expected that milk prices may take (another) step in the coming months, given the raw material value of milk gained considerable ground in October. Typically, payment prices respond to rising dairy prices with a delay of a few months.
United States and New Zealand
Prices are also increasing in the United States and New Zealand. For example, Fonterra increased its milk price forecast last month by $0,30 to a range of $6,55 and $7,55 per kilo of milk solids (approximately 11,5 liters of milk). If the forecast is maintained, this would be the highest payout price since 2014.
In the United States, the milk price has escaped the trough. In 1 year, the milk price (class III) has risen by no less than 20% to €37,34 per 100 kilos in October.
This article is part of this week's published Trend report Milk and Feed Pro, which also focuses on the manure market, interest rate market and feed market. Click here to read the Trend Report.