Market report: Milk prices up for sixth month in a row

Farmgate milk prices increased for the sixth month running in September, according to latest statistics from DEFRA.

It put the average UK price, including bonuses, at 25.14p/litre, 0.44p/litre up on the previous month and 1.08p/litre higher than a year before. But, it was still well below the Actual Milk Price Equivalent, which measures butter and skimmed milk powder values, and was pegged at 29.8p/litre in September.

With global and domestic commodity markets remaining firm, the outlook for farmgate prices should be positive, said a DairyCo Datum report.

“After falling from May to August, world market prices have staged a revival. Whole and skimmed milk powder prices went up by US$100 and $150/t in October, with Cheddar cheese and butter prices up by $150 and $200/t. Compared to the summer of 2009, butter prices have doubled, WMP prices are up by around 70%, with SMP and Cheddar prices up by around 50%.”

This was despite increased annual production in the US and EU, and forecast higher output in Australia and New Zealand, it added.