Farmgate milk prices lag behind market returns
Farmgate milk prices increased by 0.8p/litre in June, to a record high of 30.77p/litre, according to data from the Rural Payments Agency. Butterfat averaged 3.84% – well below last year’s 3.93%, while protein content was unchanged on the year, at 3.22%.
Although prices were 4.66p/litre higher than June 2012, they still lagged way behind DairyCo’s calculated returns from the market. Between June and July, both mild and mature Cheddar values increased by £75/t, to average £3,325/t and £3,525/t, respectively. As a result, the Milk for Cheese Value Equivalent increased by 0.8p/litre, to 37.5p/litre – 6.7p higher than July last year.
Improved butter prices pushed the Actual Milk Price Equivalent up by 0.5p/litre, to 39.3p/litre in July, said the report. “Skimmed milk powder prices remained unchanged, with markets relatively balanced.” Although demand was limited, the continued scarcity of supplies was keeping prices firm, it added.
Fonterra’s first auction since news of a botulism contamination in its milk powder saw prices slip by 2.4%, to average US$4847/t. However, volumes jumped by 60%, to 60,587t, indicating that demand remained firm despite the scare.
UK milk production climbs back to three-year average
Market report