Analysis Milk
German milk production further contracted
The sharp contraction in German milk production, which has been visible since last summer, continued to strengthen in November. Milk supply in Germany has contracted even further compared to a year ago.
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German livestock farmers delivered 2.447.300 tons of milk to processing companies in November. A volume that is well below the spring level. In November 2020, 2.519.410 tons of milk were still produced. This means that production last year was 72.000 tonnes, or 3%, below the level of one year earlier. The contraction is therefore even greater than in September and October, when milk production decreased by 2,5% and 2,3% respectively.
With the current contraction, the milk supply is, as in previous months, well below the five-year average. In the past five years, 2.511.700 tons of milk were produced in Germany in November. Production is now about 64.000 tons below that (-2,6%). It is increasingly looking like the German milk pool has reached its ceiling. After production showed significant growth in the years after the abolition of the milk quota, this phase now seems to be behind us.
Spot milk remains expensive
The tight milk supply in our region continues to support prices for freely available milk in Germany and the Netherlands. After the real peak in prices in the weeks around the turn of the year has been removed, prices stabilize at €50 per 100 kilos. These are still record high prices from a historical perspective.