The world milk price has increased by 35% to a level of approximately US$30 or €27 per 100 kg milk since June 2016. This is according to the IFCN Monitoring. Also the European Commission is positive about milk market recovery.
After 2 years of lows in milk pay-out, world production is finally decreasing. Latest projections confirm that currently world milk demand is growing faster than the supply in 2016 and 2017.
Torsten Hemme, Managing Director of IFCN, commented at the recently held annual IFCN Supporter Conference: “Further price increases are a logical consequence unless any major dairy demand crisis arises.” The 14th IFCN Supporter Conference 2016 IFCN attracted over 110 analysts and dairy professionals from about 80 leading agribusiness companies and was held last week in Wageningen, the Netherlands.
According to Dutch farmers weekly Boerderij, the European Commission is also confident that the milk market can be restored. Jerzy Bogdan Plewa, Director-General of the European Commission’s Directorate-General for Agriculture and Rural Development shared his vision at a recent meeting of the Agricultural Markets Task Force (a working group of the European Commission). Plewa said that markets are recovering slightly, although this is not directly reflected in the income for dairy farmers. “But experts forecast a change,” according to Plewa.
The European Commission expects an increase in dairy demand, both within and outside the European Union. The European produced dairy would then be able to develop further and increase its position on the global dairy market.