News milk prices
FrieslandCampina deviates from milk price trend
After FrieslandCampina increased the guaranteed price by €1 last month, another correction will follow for September.
The dairy cooperative lowers the milk price by a quarter to €33,75 per 100 kilos, the first drop since June. The guaranteed price has picked up in recent months, thanks to a recovery in the dairy market after a sharp decline in the second quarter due to the corona crisis.
The reduction in the guaranteed price for September can be seen as a correction to the milk prices of the reference companies that were estimated too high. The trend in the Netherlands and Europe is precisely that milk prices are slowly recovering from the decline as a result of corona. In the milk price comparator from Boerenbusiness FrieslandCampina continues to stand above Arla, which kept the milk price unchanged for September. FrieslandCampina expects the reference companies to decrease in the coming months, due to a growing milk supply worldwide.
No pre-corona levels
So it is unlikely that milk prices will return soon after pre-corona levels. Prices for solid dairy products (butter, milk powder and cheese) cannot continue the recovery, due to high stocks and sluggish demand. Liquid dairy prices have risen sharply on the spot market.
For example, the DCA listing for spot milk meanwhile incurred up to €39 per 100 kilos (with 4,4% fat, delivered). This is the highest level since 2018. Due to the prolonged heat wave earlier this month, the milk supply has decreased significantly, making spot milk downright scarce. Because the fixed prices for dairy products do not change, it is expected that the prices for spot milk and cream, among other things, will undergo a correction.
Wouter Job
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