Global production not responding to price signals

Published 26 August 15

Global production appears to be ignoring price signals from dairy markets. Milk production in many countries remains strong, despite farmgate prices falling between 20-30% in the year to June 15.

Price signals 26.08.15 

Although some are predicting a turnaround next year, see here for more, it will not be until the supply/demand imbalance alters that prices are expected to recover. Assuming normal weather conditions and no disease outbreaks, the supply/demand position is not likely to improve unless production starts responding to price signals soon or buyer demand significantly increases.