Milk prices reached R$2.87 per litre as costs rose
The average net price paid by Brazilian dairies for raw milk reached R$2.8761 per litre in July, according to the Cepea survey supported by the OCB. The figure, known as the national average, was 4.65% higher than in June. After adjustment for July’s consumer-price inflation, the increase from the same month of 2025 was 4.96% in real terms.
At the same time, Embrapa’s ICPLeite index showed that milk-production costs climbed 4.13% during the first eight months of 2026. That exceeded the 3.11% inflation recorded for Brazilian households over the same period. The index rose 1.47% in August, marking its second consecutive month of substantial growth, while household living costs fell by 0.32% during the month, according to Brazil’s statistics agency, IBGE.
Minerals recorded the largest monthly increase in the ICPLeite, at 10.89%. The concentrate category rose 3.35%, driven by feed and maize. Over the 12 months to August, the production-cost index accumulated a 3.73% increase, compared with 1.72% in the 12 months to July. Embrapa also reported double-digit annual increases for minerals, animal health and reproduction.
Embrapa said the increase was not yet a consequence of El Niño. It attributed the movement to reduced pasture availability, more expensive grains and imported inputs, and greater tension in international markets. Labour costs also contributed because of their share of total production expenses.
The two indicators cover different samples. ICPLeite tracks farms in Minas Gerais, whereas Cepea’s Effective Operating Cost measure has national coverage. The latter increased by 0.63% between July and August across Brazil. Rio Grande do Sul recorded the largest state-level increase in that survey, at 1.38%, with more expensive concentrates and mineral supplements identified as common features of the movement.
Cepea reported weaker momentum in the dairy market during September, with prices showing greater stability and less support. In São Paulo’s wholesale market, UHT milk rose 0.45% in August to R$4.89 per litre, a movement linked to higher raw-material prices. Embrapa said that rising costs, together with an expectation of lower prices paid to farmers in the second half of the year, tend to reduce margins through the summer.
Cheese led Brazil’s dairy exports in the period. Overseas sales increased 39.54% between July and August, reaching the equivalent of 2.47m litres of milk and accounting for 47% of all Brazilian dairy shipments in August, despite a decline in total dairy exports. Compared with August 2025, however, cheese exports were 4.6% lower.
