UK Milk Prices See Increment Despite Continued Market Uncertainty

Milk production in the United Kingdom has experienced a downturn, leading to a rise in prices by a few processors for the month of July. Dairy analyst Chris Walkland remarked that while output has been below last year’s levels since mid-April, this follows a very high base. Meanwhile, milk production in other significant exporting regions such as the European Union, the United States, and Oceania remains robust.

Walkland noted that reduced milk prices last winter are gradually affecting production volumes. In the US, farmers are maintaining every cow to ensure calf sales, consequently boosting milk output. Additionally, European dairy commodity markets have seen some stabilization, with prices for skimmed milk powder increasing since the start of the year.

Price Increases

Arla and Saputo, two major processors, have increased their prices to 37p per litre for July and August deliveries, respectively. Barber’s Cheesemakers also announced a 1.55p per litre increase for its standard litre in August, reaching 35.15p per litre, driven by strong exports to the US. Michael Masters, head of milk supply operations at Barber’s, emphasized the effort to add value to milk to ensure sustained supply for cheese production.

However, Walkland expressed uncertainty about the sustainability of these price increases. Despite the expectation for rising milk prices, the current market for cream, butter, and cheese shows declining prices, complicating efforts for processors to offer higher milk prices.

Current Pricing by Processors

• Arla increased their July price by 1.32p, making conventional milk 37.24p per litre, supported by a favorable currency exchange rate.
• First Milk confirmed an additional 0.6p for July, bringing its manufacturing standard litre to 31.35p per litre.
• Muller maintained a steady price of 34.5p per litre for August.
• Barber’s Cheesemakers will pay 35.15p per litre for manufacturing milk in August.