UK Dairy Processors Raise Farmgate Milk Prices Amidst Global Dairy Market Rebound
Source: DairyNews.today
Several major dairy processors, including Arla, First Milk, and Müller Milk & Ingredients, have announced increases to their farmgate milk prices, citing favorable shifts in global dairy markets. The price hikes come amid what industry leaders describe as "positive momentum" in commodity prices, offering some relief to milk suppliers facing challenging production conditions.
Müller Milk & Ingredients has increased its price for direct suppliers by 1 pence per liter (ppl) starting November 1, 2024, building on a previous 1ppl increase in October. First Milk followed suit, announcing a 1.25ppl increase for its members' standard liter, effective November 1, which includes a member premium. Arla also raised its on-account price by 1.69ppl for conventional and organic milk in October.
Other liquid milk processors, such as Crediton and Payne’s Dairies, adjusted their prices by 0.75ppl and 1.50ppl, respectively, while Tesco held its current prices, and Sainsbury’s reduced its price by 0.04ppl.
In the cheese sector, several processors increased their prices, reflecting a continued trend of rising farmgate prices. Leprino Foods raised its price for the fourth consecutive month by 0.50ppl, while other companies, including Wyke Farms (+0.48ppl), Wensleydale (+0.77ppl), Saputo Dairy (+1ppl), and Belton Farm (+1ppl), followed suit. Barber’s Cheesemakers and South Caernarfon Creameries also increased prices by 0.60ppl and 1.25ppl, respectively.
Mike Smith, Vice Chairman and Farmer Director at First Milk, emphasized that the increases are driven by rising dairy commodity prices, despite adverse weather conditions. “We are seeing positive momentum in dairy commodity prices, which is reflected in this price increase. It will undoubtedly be welcomed by our members, who have been navigating difficult on-farm conditions due to variable weather,” Smith stated.
Arthur Fearnall, Arla Foods amba board director and Arla farmer, noted that the demand for fat-heavy products, particularly butter, is fueling the price surge. "The rise in prices is largely driven by strong demand and the limited availability of fat in the EU, combined with traditionally lower milk volumes during this time of year," Fearnall explained. He described the outlook as "slightly positive" for the near term.
Paul Dover, UK Agricultural Director at Arla, added that while the price increase is welcome, labor shortages continue to challenge farm productivity. "Our recent survey shows that maintaining and improving farm productivity has become increasingly difficult due to labor shortages. We urge the government to invest in developing the necessary skills for on-farm work and to promote farming as a high-skill, desirable profession," Dover remarked.
Other liquid milk processors, such as Crediton and Payne’s Dairies, adjusted their prices by 0.75ppl and 1.50ppl, respectively, while Tesco held its current prices, and Sainsbury’s reduced its price by 0.04ppl.
In the cheese sector, several processors increased their prices, reflecting a continued trend of rising farmgate prices. Leprino Foods raised its price for the fourth consecutive month by 0.50ppl, while other companies, including Wyke Farms (+0.48ppl), Wensleydale (+0.77ppl), Saputo Dairy (+1ppl), and Belton Farm (+1ppl), followed suit. Barber’s Cheesemakers and South Caernarfon Creameries also increased prices by 0.60ppl and 1.25ppl, respectively.
Mike Smith, Vice Chairman and Farmer Director at First Milk, emphasized that the increases are driven by rising dairy commodity prices, despite adverse weather conditions. “We are seeing positive momentum in dairy commodity prices, which is reflected in this price increase. It will undoubtedly be welcomed by our members, who have been navigating difficult on-farm conditions due to variable weather,” Smith stated.
Arthur Fearnall, Arla Foods amba board director and Arla farmer, noted that the demand for fat-heavy products, particularly butter, is fueling the price surge. "The rise in prices is largely driven by strong demand and the limited availability of fat in the EU, combined with traditionally lower milk volumes during this time of year," Fearnall explained. He described the outlook as "slightly positive" for the near term.
Paul Dover, UK Agricultural Director at Arla, added that while the price increase is welcome, labor shortages continue to challenge farm productivity. "Our recent survey shows that maintaining and improving farm productivity has become increasingly difficult due to labor shortages. We urge the government to invest in developing the necessary skills for on-farm work and to promote farming as a high-skill, desirable profession," Dover remarked.
