Milk prices rise while supply recovery may temper gains
Arla will add 1.76p per litre to payments for October milk, bringing its average rate for milk with 4% butterfat and 3.3% protein to 39.17p per litre. The increase is the co-operative’s fourth consecutive monthly rise, and members have received almost 5p per litre more over that period.
Arla said global milk supply had stabilised at a high level and that commodity prices were more balanced. It described the outlook for both conventional and organic milk as stable. Muller will raise its Muller Advantage rate by 0.5p per litre for November deliveries, to 37.5p. This is its third successive increase and represents a 3p per litre rise since August.
Richard Collins, Muller’s agriculture director, said the company recognised the pressures on supplying farmers and regarded a competitive milk price as a priority. He said Muller would continue to review market conditions and monitor supply and demand.
First Milk will leave its November price unchanged at 39p per litre for standard manufacturing milk, including a member premium. The decision follows increases totalling 6.15p per litre for September and October deliveries. Barbers Cheesemakers is also retaining its rate, at 40.11p per litre for manufacturing milk with 4.2% butterfat and 3.4% protein, after three consecutive increases.
Michael Masters, Barbers’ head of supply operations, said UK supplies remained tight but that excess deliveries in continental Europe were weighing on markets. Germany, the European Union’s largest milk producer, is almost twice the size of the UK and has produced about 5% more milk than a year earlier throughout 2026, he said.
GB milk deliveries reached 33.02m litres a day in the week ending September 19, up 1.5% from the previous week. AHDB data nevertheless put supplies 3.7% below the same period a year earlier. Susie Stannard, the organisation’s lead dairy analyst, said output was still short of the required level and that bluetongue could affect supplies. The return of grass growth in autumn and the start of autumn calving in some herds have been accompanied by signs of recovery.
Commodity prices in the UK strengthened in September. Butter rose 3% to £3,540 a tonne, skimmed milk powder increased 11% to £2,730 a tonne and mild cheddar advanced 9% to £3,330 a tonne. Stannard said demand for protein was supporting sales of cottage cheese and Greek yoghurt. She added that butter remained in surplus, while cheddar stocks were more closely balanced.
International markets remain under pressure. Stannard said US milk exports had grown from a minimal share to about 17% of total output, putting downward pressure on prices elsewhere. She described the outlook for domestic milk supplies as broadly bearish and said farmgate prices would require long-term support from commodity values; she did not expect prices to return to previous levels.
