Milk prices rise above 40p/litre as volumes fall
© Tim Scrivener Dairy farmers should notice a welcome lift in returns for milk during June and July as many processors increase prices in a bid to secure supplies.
Milk prices have finally broken through the 40p/litre ceiling with Arla, Barbers Cheesemakers, and First Milk all now paying in excess of this.
GB milk supplies have been running slightly below last year’s volumes throughout April and May, with the wet spring hampering production.
See also: Milk prices keep climbing with spring peak likely to be low
The spring flush peaked on 12 May with GB daily milk deliveries a touch back on the year at 36.7m litres a day.
Christine Pedersen, principal consultant at The Dairy Group, said it had been a very challenging spring for most dairy farmers, which was reflected in daily milk supplies in April being 1.8% lower than April 2023 and 2.4% lower than the three-year average.
Ms Pedersen added that peak production in May lagged five days behind, and 1% below peak production in 2023.
Uplift for milk prices
Arla has increased its June price by 0.44p/litre to 40.89p/litre for a standard manufacturing litre, while organic producers supplying the processor will receive 50.87p/litre.
Arthur Fearnall, Arla Foods amba board director and farmer, said: “Global milk supplies continue to be stable or slightly lower, retail sales continue to show growth and commodity markets are stable, however fat prices are increasing. In the UK, the organic milk price increase is driven by increasing profitability. Overall, the outlook is stable.”
Dairy farmers supplying Barbers Cheesemakers will receive a 1.03p/litre increase in July taking its milk price to 41.28p/litre based on a standard manufacturing litre.
Muller producers will be paid a July price of 39p/litre for a standard liquid litre, including its advantage premium, up by a penny on the previous month.
Richard Collins, head of agriculture at Muller, said: “We recognise the ongoing pressures that our supplying farmers are facing.
“While the market outlook is stable, following a 0.5p/litre increase for June, we are pleased to be in a position to increase our farmgate milk price by another 1p/litre for July.”
First Milk is set to increase its milk price by 0.8p/litre to 40.3p/litre in July for a standard manufacturing litre, according to Milkprices.com.
Meanwhile, Saputo Dairy will increase by 0.5p/litre to 40p/litre (manufacturing) in July.