With board members meeting next week to set September milk price, the indicators suggest a price rise is on the way.
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UK dairy farmers are seeing price rises at the moment and also Friesland Campina have lifted milk price.

By all accounts, it’s not only fuel at the UK petrol pumps which is in demand.

Worried consumers in the UK are starting to stock up on bulk butter and cream and, subsequently, prices are starting to really move to very high levels, similar to what is happening to beef sales in the UK.

Some reports suggest butter in the UK is up by over £500 per tonne in the week (£3,450 to £3,950/t).

What’s driving this is the price Irish butter manufacturers can get on EU markets. The current EU butter price converts to between £3,950 and £4,250/t.

EU dairy commodity prices continued an upward curve this week. Skim was up to €2,690/t, butter to €4,270/t, whole milk powder to €3,330/t and cheddar prices to €3,270/tonne.

Global markets

Ireland is not selling as much cheddar cheese into the UK either (down close to 40% year on year) because it can get more for it on global markets.

At farm level, there have been a number of price increases in the UK.

On the non-contracted liquid milk pools, Muller is up 1ppl to 30p for November, while Medina is up 1.7p from October to 29.8p. Yew Tree Dairy is also up 1.4p from October to 30.5ppl.

Friesland Campina in Holland has increased its price for October by €1.5/100kg, so price is just shy of 40c/litre.

The GDT has been rising through September, but the result this week was neutral – it didn’t change from the last auction.

The price of whole milk powder traded at the auction dropped 0.4% and the price of skim lifted 0.5%. It reinforces a steady demand as New Zealand annual milk flow peaks about now.

The Ornua purchase price index (PPI) for the month of September is 121.8, up from 118.1 in August. By our estimates, this result is the highest index reported by Ornua since 2014.

The September Ornua result just announced equates to an all-in milk price ex-VAT of 37.8c/litre (39.8c/l incl VAT). This price can then be compared to Irish farmgate prices that are in general 4c/l behind farmgate prices.

Milk suppliers will be expecting a price rise next week and they should get it this time.

A farmer’s life is always busy, but when you add in looking after the family and a sideline business as an artificial breeding (AB) technician, with a run that is spread out over many kilometres, it can become a balancing act.

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