Drought in Europe contributes to favourable outlook for milk prices

MILK price prospects remain favourable, with drought conditions in some EU countries affecting supply. Many parts of Europe had only 40% of normal rainfall in the past three months.

Milk supplies are affected by these conditions in regions such as the south of England and France, said United Dairy Farmers CEO David Dobbin, after a 0.67 pence per litre increase in their recent milk auction in Northern Ireland.

“We are now seeing EU and local milk supplies ease back, and this has helped stabilise international dairy markets. With the northern hemisphere peak milk supply period now behind us, we expect to see further improvement in United’s auction prices over the next few months,” he said. International dairy prices rose last week in Fonterra’s online auction, by 4.5% on average.