The global dairy market is poised to provide ‘good returns for the foreseeable future’ due to low global milk supply.
Dairy markets remain strong as global supply tightens, according to a Lakelands spokesperson, adding that “the market will continue to provide good returns for the foreseeable future.”
It comes as some major Irish milk processors have raised their milk prices by at least 2c/L in recent days, also increasing the price of their milk last month.
According to the Agriculture and Horticulture Development Board (AHDB), global milk production continued to report year-on-year deficit in March, with total milk distribution in major producing countries declining by 0.7 per cent from last year.
The average global daily milk delivery from March 2021 to March 2022 was less by 5.8m liters per day.
Unfavorable weather has severely affected milk production in Australia, New Zealand and the US, while Ireland, which was mostly in growth over the previous year, was 2.5 per cent lower in milk production from March 2021 to March 2022.
Daily deliveries in the EU-27 were down 0.5pc last year and counteracted the annual growth seen in some regions, with declines in major countries such as the Netherlands (-2.5pc), Germany (-1.4pc) and France (-1.2pc) went. Like in Italy (+2.9 pc) and Poland (+1.8 pc).
This comes as some of the main Irish processors recently announced an increased milk price for May Milk.
The Kerry Group announced a 2c/L increase for May milk, as did Lakeland Dairy, which said global dairy markets “remain firm.”
“Inflation is affecting farmers, processors and food manufacturers at every level. Market sentiment is becoming more challenging as rising costs affect all categories of goods and services and the war in Ukraine continues to have far-reaching effects.
Glanbia also announced a 2c/L increase for May milk and said dairy markets “continue to perform at higher levels, in the face of easing global milk supply and some inflationary pressures impacting consumer demand in certain markets.” With a balance between
Dairygold recently announced a 2.5c/L increase for May milk, saying the increase “reflects society’s ability to return a stronger milk price to suppliers from continued strength in milk markets.”
A spokesperson for the processor said this strength is driven by global demand for dairy ingredients and supply constraints in major milk producing regions.
“The society recognizes the significant increase in input costs for suppliers this year and will continue to maximize the value of milk returns to address this challenge.”