IFCN: The price of raw milk on the world market is declining for the fourth month

Thus, in August 2021, the price of raw milk on the world market was $ 41.5/100 kg (30.4 rubles/kg, Dairy Index DIA in August 28.88 rubles/kg), which is 2.9% lower than in July 2021 and 11.5% lower than in April 2021. Further dynamics of milk prices will depend on demand from key importers, supply in Oceania, weather conditions (the summer drought has already affected milk production in many regions) and the pandemic.

Prices for exchange-traded dairy products began to grow, as we already wrote yesterday about GDR auction.

Dairy Intelligence Agency also reported to The DairyNews that in April-May 2021, milk production in the UK grew, +1.4% to the level of 2020, but -0.2% to the level of 2019. However, in June-July 2021, due to the heat, there was a decrease of -0.7% to the level of 2020 and -1.4% to the level of 2019. In general, in the 2021/2022 season in the UK, milk production is projected to be about 12.58 million tons, an increase of + 0.3%.

The price of milk in the UK in 2021 is higher than the average level of the last five years (in July 2021, it is estimated about 30 pence/l).

The export of dairy products from the UK decreased in 2021 (in January-May 2021, the export of milk powder decreased by 36%, cheese by 38%, butter by 38%, the export of milk and cream increased by 2%). This is due to the difficulties with the transportation of goods in the first place. There are also problems taking into account the movement of goods between Ireland and Northern Ireland after Brexit. In general, Brexit has made life very difficult for British business, although trade with the EU has remained duty-free, but there are other problems - checking goods at customs, red tape with paperwork, problems with the workforce: there were many workers from Eastern Europe.

Imports of key dairy products also decreased in 2021, if we look at the dynamics of the availability of products on the UK domestic market in January-May 2021 vs January-May 2020, the volume of milk powder increased due to a decrease in exports and low indicators in 2020, but the volume of cheeses decreased (due to a decrease in imports).

As in many countries in the UK, sales of dairy products in retail grew in 2020, by 2022 the growth rate of sales in retail chains will decrease, while the return of demand in HORECA to pre-Covid levels will be slow.

In the long term, the UK dairy market is expected to see a decrease in the number of cows with an increase in milk yields, an increase in demand for deep-processed products and the growing influence of the "green agenda" on production and consumption.

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