The protein percentage has been raised from 3.35 to 3.40% and the annual delivery has been increased from 350,000 to 500,000kg. It is difficult to ascertain a representative profile throughout the EU because each country has its own typical profile and the standard litre used continues to be geared towards milk production profiles in mainland Europe which often have higher average levels of fat and protein but lower levels of volume. For further explanation of the standard litre, please click here

The adjustment has meant that prices for Arla Foods UK and First Milk have increased by a total of €0.36/100kg and €0.65/100kg respectively, due to their bonus schemes. First Milk prices have increased by €0.18/100kg for protein and €0.47 for volume. Arla's current contract does not have a protein bonus, and therefore benefits solely on the volume bonus. Glanbia's price also rises by €0.21/100kg because of the change in protein. It should be noted, however, that this higher delivery volume remains lower than the average in the UK, and therefore is not totally representative as the average UK dairy farmer would receive a still higher volume bonus.

This is contrary to the situation in Belgium. Milcobel pays a relatively high volume bonus - but the average annual delivery is less than 300,000kg - significantly lower than the new standard. Some companies, such as Friesland Foods, make a fixed deduction, which is spread over the total number of litres delivered. With higher delivery figures, this has led to a decrease in the cost per litre and consequently the price per litre is higher. Supplementary payments have also increased for Campina, Friesland Foods, Milkobel and Arla Foods Sweden due to the this change.

Using the new LTO standard litre, the average EU milk price in February was €28.04/100kg. Due to the change it is not possible to compare this price with previous months. For prices for previous months please click here

In terms of UK companies, both Arla Foods UK and First MIlk are well below the EU average, with prices of €25.24 and €24.73/100kg respectively. However, as explained above, the LTO standard litre is still not representative of the British dairy farmer.

Elsewhere in Europe, despite prices for dairy commodities continuing to be exceptionally firm, most dairy farmers are facing lower milk prices. Based on recently published annual reports, the milk prices paid by Friesland Foods and Arla Foods Sweden are 2% lower than the previous year, and those of Campina are 3% down.

For an explanation of what the milk prices are based on please see EU price explanation.

All EU milk prices and monthly country average prices can be viewed in Excel Backdata.

AVERAGE EU MILK PRICES

According to Forum Europa, some European countries have seen an increase in milk prices when compared with January 2006. Prices in Ireland have risen from €28.11/100kg in January 2006 to €28.30/100kg in January 2007. Finland and Sweden also saw rises of €0.18/100kg and €1.91/100kg respectively, and the Netherlands saw prices increase from €27.64/100kg to €27.73/100kg.

Prices in the UK are reported to have increased by €0.12/100kg, going from €26.49/100kg in January 2006 to €26.61/100kg in January 2007. This increase was due to differences in the exchange rate - in January 2007 the average rate for Sterling was 3.2% higher than in January 2006. For further details on exchange rates please click here.

On the other hand, prices have continued to decline in Germany and France, comparing January 2006 with January 2007, they have fallen by €0.20/100kg and €1.5/100kg respectively (although the price in France has not been confirmed).

For prices on more EU countries please view the back data at the bottom of the page.

TheCattleSite News Desk