Wholesale dairy commodity markets remain strong

Wholesale dairy markets recovered in June, after dipping slightly in May, according to the latest figures from DairyCo.

Its Actual Milk Price Equivalent, based on values for butter and skimmed milk powder, increased by 0.2p/litre to 38.8p/litre – the same as April’s value and 15.3p higher than in June last year.

The Milk for Cheese Value Equivalent, based on returns from mild Cheddar and whey, increased to 36.65p/litre – 1.55p up on April and 6.21p higher, year-on-year.

“Wholesale markets continued to be driven by supply considerations, with most products seeing some further upward price movements in June,” said the report. “Demand remains rationed, with buyers only coming back to fill short-term requirements.”

However, average UK daily milk production remained around 2% below the three-year average in June, sustaining pressure on available supplies for manufacturing. Despite this, ex-farm milk prices fell by 0.27p/litre in May, to 29.82p/litre – 2.88p/litre above the same time last year, according to provisional figures from the RPA.

Global commodity prices improved slightly again at Fonterra’s latest auction, with the GlobalDairyTrade average rising by 0.7%, to US $4,643/t (£3,065/t).

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