Market Update

Spot milk prices are still holding at 27p to 28p with regular reports that Freshways are the main regular buyers of spot milk and are short on volume.

A key challenge for liquid processors who are paying a liquid standard litre price at the top end is balancing the books at current cream prices.

According to AHD Dairy the January 2019 bulk cream price was £1710 and one year later was down to £1300 representing a 24% fall.

Price moves for February and March will fall into two distinct camps.  Those who dropped too low for far too long who need to lift prices or risk supplies. Which boils down to liquid processors paying 25p or less.

Then there are bottom end cheese processors paying 27p or less.

Finally, those who have held prices high for as long as possible in the hope they didn’t have to drop who are now forced to adjust. 

There is a small glimmer of hope for prices in the second half of the year especially for Cheese processors who will be praying that the currency will not strengthen to the point it sucks in cheap imports which would put a spanner in the works.