Farmers Need to See Better Returns from Dairy Price Rises

UK - More money should now be coming back to the farm gate as further positive moves take place on the markets, NFU dairy board chairman Michael Oakes has said.
calendar icon 6 July 2016
clock icon 2 minute read

Dairy commodity prices have strengthened with AHDB figures showing that as the markets continued to firm throughout June, wholesale prices have also been pushed up.

Despite a number of milk price increase announcements for July and August, prices remain far below sustainable levels on farm, NFU said.

Speaking on the eve of the Livestock Event, Mr Oakes said: “With the cream prices rising, we should be seeing milk prices improve across the board and in that respect it was disappointing to see Muller hold the milk price for August. There are clearly delays which just don’t make sense.

"Both AMPE and MCVE, dairy market indicators, have recently increased, with AMPE up 12 per cent to 18.9ppl in June and MCVE up 19 per cent to 19.6ppl in the same month.

"With such leaps forward in those price indicators surely we should at least see some of the lower end cheese prices start to improve. Spot milk prices have also jumped from 16ppl in May to 25ppl in early July, yet we haven’t seen such a big lift in B prices – these should theoretically be the first to react to market improvements.

"On liquid milk we need to make sure processors aren’t hiding behind retail premiums. Retailers have stuck by their word with minimum pricing on liquid milk, and in some cases on cheese, but these should not be used to hide real dairy market improvements.”

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