Free fall for Irish and Belgian milk prices

The average milk price drops by €0,97 in March to an average of €33,26 per 100 kilos of milk. This means that the average milk price for March 2020 is €0,35 (1%) lower than in March 2019. It is not unusual for the milk price to drop in this month. Due to the seasonal increase in milk production, prices in spring are generally lower than during the rest of the year. However, this year's price drop shows that the corona crisis has a significant impact on prices.

Strong decline in Ireland and Belgium
The most striking price changes in the milk price comparison can be found at the Irish processors Glanbia Ingredients, Dairygold and Kerry Agribusiness and the Belgian Milcobel. The price drop of Glanbia in particular stands out. The processor reduced the milk price by no less than €4,80 to €30,53. This is due to a price reduction of €2,00 and the expiration of the seasonal premium. The price includes a cooperative surcharge of €0,95 and a surcharge of €0,40 as a share in the processor's profit.

The other two Irish processors dropped the price less drastically, but this drop is also not for the faint of heart. After a correction of €2, the price of Dairygold amounts to €3,00 and Kerry Agribusiness adjusts the price downwards by €30,78 to €1,70. Both prices include a bonus of €31,31 for the national sustainability program SDAS.

In addition to the Irish processors, the Belgian Milcobel is also adjusting the price significantly downwards. In total, the milk price drops by €0,30 to €29,72, making Milcobel the first processor to charge a price below €30 per 100 kilos. The milk processor provides no further explanation for the price drop.

Price increase for DMK and Arla
The only processors that adjust the price upwards are the German DMK and the Danish Arla. DMK increases the price by €0,50 to €33,18. This price includes a bonus of €0,66 for the Milkmaster sustainability program, but excludes a surcharge of €0,70 for the use of GMO-free animal feed. The processor will leave the price unchanged for April.

Arla increases its milk price by €1,00 to €33,46. This price includes a bonus of €1,00 for participation in the Arlagarden Plus quality and sustainability program, but excludes a bonus of €1,00 for the use of GMO-free animal feed and excludes a bonus of €0,50 for welfare . Arla has announced that it will reduce the price again by €1,00 for April.

CAPSA FOOD added to processor list
From March, the Spanish CAPSA FOOD will be included in the LTO milk price comparison. This is to gain more insight into milk price developments in Southern Europe. CAPSA is the largest dairy processor in Spain after Lactalis. The milk price of the newcomer for March is €31,27. This is a decrease of €0,70 compared to February.

Among the other (international) processors, the price change of American Class III milk stands out. The price rose in 2019 to well over €40 per 100 kilos of milk, but has now fallen sharply to €36,57. The price fell by as much as €2,20 in March. This is due to a price reduction and exchange rate change. In the next two months, the price could fall by another 30% due to futures contracts.

The milk price of the Swiss Emmi increases by €0,30 to €51,78 in March, but will decrease again in April and May by €0,90 and €1,20 respectively. The price of Fonterra drops by €0,70 to €31,19 in March.