The MPI is published fortnightly by the UFU and aims to give NI dairy farmers an indication of returns available from commodity markets.

The union highlighted the pressure on skimmed milk powder (SMP) markets in its MPI commentary on Friday.

Although Tuesday’s GDT auction in New Zealand saw the index rise by 1.7%, cheese prices were down 1.0% to $3,406/tonne and SMP was down 10.1% to $1,948/tonne.

However, butter continues to trade strongly, with prices up by €60 to €4,310/tonne in Dutch Dairy Board and up 4.9% at the GDT on Tuesday to $4,910.

“SMP is a by-product of butter and this means more SMP will be available with no destined market. Consequently, the SMP price continues to fall,” the UFU state.

The MPI calculation is based on adaptions of existing industry market calculations of Actual Milk Price Equivalent (AMPE) and Milk for Cheese Value Equivalent (MCVE). The indicator does not include processor margins or transport costs.

Milk prices

Meanwhile, milk processors in NI have held their prices for February with LacPatrick and Dale Farm staying with prices of 25.7ppl and 25.8ppl respectively.

This includes LacPatrick’s 0.2ppl Red Tractor bonus and Dale Farm’s 0.3ppl loyalty bonus and is before adjustments to prices for milk quality, hygiene and transport costs are made.

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