Market value of milk stabilises

Published 30 July 18

A general slowdown in trade on wholesale markets has minimised increases in the market value for milk in July. Despite cheese markets remaining firm through the month, butter and SMP prices fell on the back of limited demand. As a result, the value of AMPE fell while MCVE rose, producing only a marginal increase in the Milk Market Value1 (MMV).

Historically, movements in the MMV are reflected in farmgate price changes three months later. Milk price increases announced for July and August were in line with expectations, reflecting the higher market prices in April and May.

The slowdown in the market in July, in itself, is unlikely to generate upward movements in farmgate prices going into the autumn. Other factors, such as any impacts of higher on-farm production costs on milk supplies, will also influence how milk prices move through the next few months.

Projected Farmgate Price Changes Table

1 Milk Market Value is a weighted average of AMPE and MCVE on a 20:80 basis.