European milk volumes decreased in September for the third consecutive month, while there was a 3.5% fall in September milk production in Ireland. According to the latest figures from the Central Statistics Office (CSO), domestic milk intake by creameries and pasteurisers was estimated at 583.2m litres.

Elsewhere, New Zealand milk collection decreased 2% in September, while Australian milk collection decreased 9% according to figures from Fonterra’s dairy update. New Zealand milk volumes for October will also be low due to a wetter than usual spring. In the key dairying region of Waikato, daily milk volumes are now down around 14% compared to last year.

Production

New Zealand: For the 12 months to September, milk production is down 1% compared to the same period the previous year.

Australia: Production for the 12 months to August is down 4% compared to the same period the previous year.

EU: Production for the 12 months to August is up 3% compared to the same period the previous year. EU Commission milk deliveries are forecast to increase 0.9% in 2016 according to the Milk Market Observatory.

USA: Forecast milk production for 2016 is up 1.7% on last year according to the US Department of agriculture.

Exports

Between June 2015 and June this year, European dairy exports rose by 11%. Fonterra’s global update shows that Australian dairy exports rose by 6% in the 12 months to July 2016, while New Zealand’s rose by 6% in the 12 months to August 2016. However, USA dairy exports fell by 5% from July 2015 to July this year.

Markets

Meanwhile, the volume of imports into China, Latin America and Asia has grown. In the 12 months to August 2016, Chinese dairy imports grew by a whopping 28%. Similarly, from between June 2015 and June this year, Latin America’s dairy imports grew by 10% while Asia’s grew by 3%. However, middle east and Africa imports fell by 7% over that time period.

Price increase

Fonterra Australia and Murray Goulburn have announced an increase in milk price paid to their farmer suppliers. The increase for Fonterra is 35 A cents (1.8 c/l), bringing the farmer milk price to $5.10/ kg milk solids (26.76 c/l).

After two years of falling prices at Fonterra’s GDT (GlobalDairyTrade), auction prices have turned around and increased by 26% since July of this year.

Murray Goulburn, the biggest dairy processor in Australia, has allocated a one-off sum of A$81.8 million (€56.44m) from the profits of it publicly traded MG Unit Thrust. It will use A$31.8 (€21.9m) of this sum to pay a price increase of A$0.02/per kg milk solids (.001 c/l) and the remainder will be used to supplement its farmer loan scheme.

John Boylan contributed to reporting for this story

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