Dutch dairy giant FrieslandCampina has lowered its December milk price slightly to 42.7c/litre (€4.15/kg of milk).
The November milk price stood at 43c/litre (€4.18/kg).
Friesland said the cut in the December milk price is a result of a downward trend for dairy products across Europe, especially for butter and cheese.
While only a slight cut in an otherwise very strong milk price, this is the first time FrieslandCampina has cut its milk price in 18 months.
European dairy markets have reacted negatively to the sharp increase in milk supply coming out of major producing regions such as Germany and France in recent months.
In the Netherlands, milk production increased in September (0.5%) and October (1.4%), which has also not helped market sentiment.
FrieslandCampina has written to milk suppliers in the last month urging them to restrain milk supplies in the coming months. FrieslandCampina said it expects milk production from its farmer suppliers in spring 2018, which is the peak period for Dutch production, to be ahead of 2017 levels.
Supply control
The dairy processor warned suppliers that it will introduce temporary measures in 2018 if milk supplies outstrip processing capacity and market demand.
The Irish Farmers Journal understands that these temporary measures will translate in A and B milk price payments, where farmers who oversupply will be paid a lower milk price or B milk price.
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Dutch dairy giant FrieslandCampina has lowered its December milk price slightly to 42.7c/litre (€4.15/kg of milk).
The November milk price stood at 43c/litre (€4.18/kg).
Friesland said the cut in the December milk price is a result of a downward trend for dairy products across Europe, especially for butter and cheese.
While only a slight cut in an otherwise very strong milk price, this is the first time FrieslandCampina has cut its milk price in 18 months.
European dairy markets have reacted negatively to the sharp increase in milk supply coming out of major producing regions such as Germany and France in recent months.
In the Netherlands, milk production increased in September (0.5%) and October (1.4%), which has also not helped market sentiment.
FrieslandCampina has written to milk suppliers in the last month urging them to restrain milk supplies in the coming months. FrieslandCampina said it expects milk production from its farmer suppliers in spring 2018, which is the peak period for Dutch production, to be ahead of 2017 levels.
Supply control
The dairy processor warned suppliers that it will introduce temporary measures in 2018 if milk supplies outstrip processing capacity and market demand.
The Irish Farmers Journal understands that these temporary measures will translate in A and B milk price payments, where farmers who oversupply will be paid a lower milk price or B milk price.
Read more
Dairy Day: milking 4,000 cows in the ‘biological Ferrari’ of Brazil
Intervention SMP: how low can you go?
EU average butter price drops 12.4%
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