Lower production boosts international milk prices

Milk prices at United Dairy Farmers’ latest auction increased by 1.4p/litre on the month, to average 27.91p/litre – the highest ever June price.

That is 2.53p/litre higher than last year, says chief executive David Dobbin. “With milk supplies having tightened locally and internationally, and with commodity markets remaining firm, we expected some improvement.” The 5% price increase was well ahead of the trend at New Zealand’s Fonterra auction, where wholemilk powder prices rose by less than 1% in June.

The poor spring weather has knocked production in Northern Ireland to close to year-ago levels for June, compared with 12% ahead of last year in April. Production has also been lower than expected in GB, France, Germany and the US.

“Coming at a time when New Zealand is at the tail end of its production season, this easing in international milk supplies, coupled with continuing firm demand, has helped stabilise international markets.”

UDF sold 50m litres of milk for July delivery, compared to 52m litres last month and 53m litres last June.

Market report