FrieslandCampina has cut its guaranteed milk price for raw milk for August to €28.50 per 100kg of milk which is the equivalent of 27.55c/L when converted to Irish constituents.
This guaranteed price is €1.50 lower than in July 2015, and is also a drop from June when the guaranteed milk price was €32.00 per 100kg.
The reduction of the guaranteed price is based on the expectation that milk prices of most reference companies in August will continue to decline, it says.
FrieslandCampina says that the persistently high milk supply after the abolition of the milk quota per April 1, 2015 and the sluggish demand for dairy products from the dairy-importing countries keep the quotations of dairy products under pressure.
The guaranteed price for August 2015 includes a correction of around €0.54 to compensate for the June forecast of the milk prices of the reference companies, which were estimated too high, it says.
The protein price in August 2015 is €465.23, the fat price is €232.62 and the lactose price is €46.52 per 100kg.
Agriculture ministers to meet in September on EU dairy ‘crisis’
Following the growing concern about the economic situation in the dairy and in the livestock sectors in certain Member States of the EU, the Luxembourg Presidency decided to convene an extraordinary Agriculture Council meeting on Monday, September 7, 2015, in Brussels.
The move comes following the European announcement of amended support measures for the dairy sector in light of the continuing downturn pressure impacting on world dairy markets and the impact of the Russian ban on EU food imports.
Milk prices paid to EU farmers have declined significantly since the second half of 2014 and beginning of this year.
The reduction in milk prices had showed signs of slowing down in February but in May, it decreased by 2.6% compared to April.
The EU average milk price, at €30.48/100 kg in May, was 19% below the previous year.