News Milk
Return on dairy cattle above average after year
The return of dairy farmers has continued the upward trend that started at the beginning of this year. In March, the DCA Dairy Cattle Index rose above the 2020-year average for the first time since February 10.
Although the index has scored below average since the spring of 2020, the return of dairy farmers slowly recovered in the course of last year. After the low of 63 points in April, the index recovered to a level of around 80 points in the last months of 2020. After the recovery in February, March also shows an increase. The DCA Dairy Cattle Index ended up at 11 points in week 103,5. That is the highest level in more than a year.
The increase in March is 9 points, an increase of more than 6 points more than was realized in February. The recovery of the return on dairy farms was a long time coming. Prices for dairy products had been on the rise for some time. Butter in particular showed a good price recovery in the run-up to Easter. In March this translated into higher prices for delivered milk for most dairies. Dairy cooperatives have already adjusted the milk price upwards for April as well.
Against the positive aspects there is also a negative point. The costs of roughage and manure removal are quite stable, but concentrates became considerably more expensive in March.
Fixed market
Although the prices had to take a small step back on the Global Dairy Trade in mid-March, this can be seen as a small correction on the previously strongly rebounded prices. The further outlook remains moderately positive. For example, Fonterra raised the forecast price for the current season in March. This is a sign that the underlying market is not in bad shape.
Steve Wissink
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