Tight supply drives high milk price at UDF auction
Milk prices reached their highest level for five years at United Dairy Farmers’ latest auction, driven by tight supplies due to poor weather and forage.
At 32.46p/litre, prices were 3.5p/litre higher than last month and almost 3p/litre more than last year, said chief executive David Dobbin. “The auction was driven by strong competition among buyers for the reduced volumes of milk available. The improved price will be welcomed by dairy farmers, who have endured a difficult summer and are now facing record winter feed costs,” he said.
The auction sold 33m litres of milk – 4m litres less than last year, reflecting the slowdown in local milk production, he added. “As a result of the acute shortage of milk, this month’s auction was well ahead of the market. United’s price for November milk will be among the very highest in both the UK and the EU.”
EU milk production had now reached its seasonal low and should start to increase again soon, said Mr Dobbin. “International commodity markets are finely balanced. Southern hemisphere milk output in the next few months will dictate the direction markets take.”
Third milk price increase at United Dairy Farmers
Market report