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Dear dairy farmers and interested parties,

Prices are rising, dairy farmers are back on track - This is the tone of articles currently doing the rounds in the European press.


However, as the latest EMB milk price comparison shows, farm-gate prices paid by European dairies have, in fact, hardly changed and have continued to languish in an all-too-slow upward trend over the last four months. In light of this sluggish price rise, it is in no way justified, from a producer point of view, to say that the dairy crisis has ended. It would also be short-sighted to believe that the market will correct itself and farm-gate prices will thus reach a cost-covering level. Over 350,000 tonnes of skimmed milk powder are currently in public storage and will exert pressure on the milk price sooner or later. The EMB has already made it clear to Agriculture Commission Hogan that this intervention milk powder cannot come back to haunt dairy farmers. German milk producers are currently staging a number of milk powder demonstrations against intervention as it is a "crisis instrument gone wrong". You can read more on the background for these demonstrations in this issue.

The market situation in Italy has brought about a slight recovery in farm-gate milk prices in the last six months, rising from 34/35 cents in February to 38/39 cents in August 2017. Production has remained on a par with 2016 levels, albeit with a decrease in July and August as a result of the severe heat in the north and south of the country. Cheese prices have stagnated, especially for matured cheese varieties like Grana Padano, currently fetching low prices on the level of 2016. The spot market price for milk has risen sharply, from 36/38 cents in June to nearly 45 cents in August.  Forecasts predict stable production until late autumn, with a decrease conceivable in view of the severe heat in the summer. Prices paid to producers in the market with direct contracts (not spot prices) are said to rise to over 40 cents from September/October. The long period of drought and the severe heat have resulted in increases in the cost of raw materials such as corn and hay, driving up production costs. At present the average production costs of milk in the north of Italy are 46 cents...

The aim of the European Milk Board is to achieve cost-covering prices for Europe's dairy farmers. Temporary production cuts, as proposed in our Market Responsibility Programme, allow for price recovery and thus liquidity on our farms during crises.

Roberto Cavaliere, EMB Board member and president of APL Italy

Agriculture Ministers want to improve current crisis instruments

© Annika Haas

European Agriculture Ministers have shown moral support for farmers and their situation. At the informal Agriculture Council in Tallinn (3 to 5 September), it was noted that the current CAP does not include adequate crisis instruments and that farmers cannot be left to fend for themselves when it comes to risk management. It is, however, still not possible to derive concrete results or measures from these statements.


Milk powder demonstrations in the lead-up to Bundestag elections in Germany


Farmers of the German dairy farmers' association (BDM) are going to stage a number of "milk powder demonstrations" in different Federal States over the coming weeks, under the slogan "Market Responsibility instead of Milk Powder Madness". The aim is to make the issue of milk powder a leading media topic by throwing it into the political arena in the course of campaigning for the Bundestag elections (24 September 2017).


Study: Dairy industry was unable to sell additional milk volumes adequately

© MEG Milch Board

The study "Milk Market Review" was carried out due to the violent collapse of farm-gate prices in Germany during the most recent milk crisis in 2015 and 2016, as well to find out whether this was unavoidable considering market conditions. Prices did not plummet so drastically in other EU countries.


EMB milk price comparison: minimal changes in milk prices

© wikimedia

Lack of movement – farm-gate prices paid by European dairies have been stuck in a languishing upward trend over the last four months. This is the main conclusion of the latest EMB milk price comparison for the period April to July 2017.


Belgian farm-gate milk price covers only 65 percent of production costs


A recent cost study shows that the costs of milk production in Belgium in 2016 were 41.37 cents/kg. As the farm-gate prices for milk were only 26.70 cents, this means only 65% of production costs were covered in 2016.


How the post-Brexit trade deal will affect British farmers

© pixabay

The UK’s Brexit deal could be a make or break scenario for Britain’s farmers, according to a study published by the Agri-Food and Biosciences Institute (AFBI). The independent study analysed the impact of three different post-Brexit trade scenarios on agricultural commodity prices in the UK, the volumes farmers produce and the prices they command.


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Phone: +32 2808 1935
Fax: +32 2808 8265
E-Mail: office@europeanmilkboard.org
Website: http://www.europeanmilkboard.org