The very strong milk price across Europe this autumn has resulted in a lot more milk being produced on the continent.

Dairy farmers in Germany and France, the two largest milk-producing countries in Europe, have been slow to react to the rapid improvement in milk prices in 2017.

In the first six months of 2017, German milk production was more than 3% down on the previous year at 15.5bn litres. There was a similar story in France, where milk production in the first half of this year was also down 3% year on year at 12.3bn litres.

Spike

However, a record spike in the price of butter from June to September resulted in very high farmgate milk prices across Europe in the back end of the year. These high milk prices have encouraged German and French dairy farmers to increase supply.

Since August, there has been a sharp increase in milk production in both Germany and France and this trend looks set to continue into 2018.

Germany

Figures released this week by Eurostat show that German dairy farmers produced more than 2.5bn litres of milk in October, which is a 5% increase on the same month last year. This follows the 3% increase seen in September milk collections.

German milk production for the first 10 months of this year now stands at 25.8bn litres, which is just 1% behind last year’s production.

France

In France, milk production in October exceeded 1.9bn litres, which is more than 5% higher than last year. September milk collections in France were up more than 4% year on year.

Cumulative milk production in France for the first 10 months of 2017 now stands just below 20bn litres, or 1% behind last year.

Outlook

If the strong growth in milk production continues in both Germany and France for the final two months of 2017, then it’s likely that milk production in both countries will end the year in line with 2016.

This would be a remarkable turnaround considering that milk production in both countries was down 3% in the first half of the year.

Read more

Dairy markets: prices under pressure as supply builds

No let-up in Dutch milk production for November