As 2023 comes to a close, this column takes a look at what happened to dairy prices over the course of the year.

The first thing to note is that while farmgate milk prices in Ireland crashed in 2023, that crash was actually well forecasted, as the commodity price crash actually took place in 2022, when milk prices were at their highest.

This indicates the lag between market prices for dairy and farmgate milk prices.

GDT

Starting with the Global Dairy Trade (GDT), prices for whole milk powder (WMP) are more or less unchanged now compared with last December.

Current prices are $3,207/t, while WMP was $3,246/t at the end of 2022. What this ignores is that it fell to $2,548/t in August, so prices have recovered to a large degree this autumn.

Skim milk powder (SMP) prices in December 2023 are $2,620/t, while in December 2022 SMP was valued at $2,965/t, which is almost 12% lower now.

As a whole, the GDT is at 1,025, while it was at 1,060 in December 2022 and fell to 850 in August 2022.

In Europe, the spot market prices for most products, with the exception of butter are down on where they were at the end of December 2022.

Cheddar cheese prices are back €480/t, WMP is back €210/t, SMP is back €260/t, while butter is actually up €555/t compared with this time last year.

An important consideration when comparing prices is supply. Supply increased at the start of the year, but by the end of 2023 it was declining everywhere and will end similar to last year at least in Europe.