FrieslandCampina reduces milk price considerably

The decline is entirely based on expectations that reference companies will reduce the milk price in the new year as a result of market developments. This expectation has already partly come true, as the Scandinavian dairy cooperative Arla significantly reduced its January milk price last week. The change does not include any corrections from previous months, FrieslandCampina said in an explanation.

Quite pessimistic 
Looking at the dairy market, it can be concluded that both FrieslandCampina and Arla are quite pessimistic. Although the market is dominated by uncertainty surrounding corona, commodity prices for butter, cheese and milk powder have moved fairly steadily in recent weeks, according to DCA quotes.

Both dairy cooperatives may be taking advantage of the fact that the first quarter is generally weak in terms of sales and that is probably especially the case in times of lockdowns in many countries.  

Bio up
When we pass on FrieslandCampina's guaranteed price in the milk price comparator van Boerenbusiness, this results in a basic payment price of €33,53 per 100 kilos, based on 4,42% fat and 3,57% protein and an annual supply of 1 million kilos. The approximately 600 participants in the PlanetProof milk flow see the payment price rise to a maximum of €37,03. The organic guaranteed price will increase by €1,58 in January to €45,17 per 100 kilos, prompted by positive market developments in that segment.