The index for November is 115, adjusted from 116.4 in October. This reflects falling butter returns and lower prices for protein (SMP and whey), partially offset by higher cheddar prices.

The PPI value for November is equivalent to a farmgate price of 33.11c/l excluding VAT, based on Ornua’s product purchase mix and assumed costs of 6.5c/l.

This is the first noticeable drop in the index since the milk price recovery started in the summer of 2016. The value of PPI flatlined in the first quarter of this year and showed a slight 0.3pt drop in April, but had otherwise steadily increased since July last year.

Co-ops are now expected to set November milk prices.

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