Dairy Crest formula milk price sees third stable month

Dairy Crest’s market-tracking milk price has stayed level for the third month running, with production still high and trade subdued.

The company’s formula contract has dropped just 0.03p/litre for June, after two small increases in April and May.

June’s formula price of 28.618p/litre will carry a more than 5p/litre premium over Dairy Crest’s standard liquid rate.

See also: UK milk production hits 20-year high as quotas end

All dairy product values fell from March to April: bulk cream dropped £100/t to £970/t and four pints of retail milk fell another 4p/litre to 103p/litre.

On the cost side, feed and fertiliser values stayed flat, while red diesel crept up to 52.5p/litre – its highest point in 2015.

Michael Masters, secretary of suppliers’ group Dairy Crest Direct, said the formula had now dropped just 0.6p/litre in the first six months of the year, though this could soon change.

More than 200 of the farmers supplying Dairy Crest have some milk priced by the tracker.

“Against the current background prospects across the five formula parameters, a more significant price reduction is now most likely to apply with the May data to apply for July,” Mr Masters said.

UK production is still running ahead of last year, despite the pressures of rock-bottom milk prices.

Daily deliveries in the two weeks to 2 May averaged 44.3m litres a day – 2.2% higher than in 2014 and 9.3% more than the three-year average.

But some EU nations are down on last year.

Germany production was 1.7% lower and French output was down 3.3% in the four weeks after the end of quotas in April.