Emmanuel Besnier: Milk Prices for Lactalis Suppliers Have Been Higher Than Competitors' for the Past Six Years
Source: The DairyNews
Emmanuel Besnier, CEO of the Lactalis Group, touched upon the topic of raw milk prices in his interview with French media, as reported by DairyNews.today.
"In terms of the widely publicized discussions on milk prices, we have encountered a sharp issue with our cow milk producers' organization Unell [National Union of Milk Deliverers]. Less than 10% of the group's producers are in France. Globally, we maintain good relationships with breeders. We must understand that milk prices are part of commercial relationships, considering the influence of the global market on us, as we have decided to collect surplus milk in France. Every second liter collected by us in France is evaluated on international markets. From 2021 to 2023, milk prices paid to producers increased by 30%. Over the past six years, the price has not been a subject of discussion for our suppliers because it has been higher than our competitors'. Today, this is no longer the case," said Emmanuel Besnier.
The interviewer noted that in 2022 and early 2023, the price paid by Lactalis in France historically was the highest due to a formula that takes into account farmers' production costs.
"And if in recent months this calculation method has led to a lower price than competitors, as it has been greatly influenced by the decline in global prices, we have rectified the situation [at the end of February], offering more <...> From billions of liters collected in France, this is still €100 million more. Rejecting the influence of international markets only when they are poor calls into question the industry's balance. If we want to change the formula, we cannot separate the question of milk price from volumes. We cannot export half of our milk and ignore international markets. Today, we are selling 40% of milk at a loss in the overheated global market for powdered milk," noted the CEO of Lactalis.
The interviewer noted that in 2022 and early 2023, the price paid by Lactalis in France historically was the highest due to a formula that takes into account farmers' production costs.
"And if in recent months this calculation method has led to a lower price than competitors, as it has been greatly influenced by the decline in global prices, we have rectified the situation [at the end of February], offering more <...> From billions of liters collected in France, this is still €100 million more. Rejecting the influence of international markets only when they are poor calls into question the industry's balance. If we want to change the formula, we cannot separate the question of milk price from volumes. We cannot export half of our milk and ignore international markets. Today, we are selling 40% of milk at a loss in the overheated global market for powdered milk," noted the CEO of Lactalis.
