July was this first month of the 2013/14 dairy season where more milk was produced than in the corresponding month from the previous season. The season started dismally with April 2013 output being 7% down on April 2012. Production has been slowly improving, but on a season to date basis, output across the first four months of the season (April to July), is still 2% down on last season.
Also helping farm profits was a fall in fertiliser prices and some feed costs. Soyameal, feed wheat, and maize gluten prices are all cheaper than they were a year ago, but intensive energy ration, and Brewers' Grain prices have increased over the past year.
Milk prices at the farmgate level in the UK were up 17.8% year-on-year during June 2013.
Dairy farmers in the UK have never been paid as much for their milk as they have this year. Data collated by DEFRA shows that the 30.77 pence per litre average milk price paid in June 2013 was the highest recorded since the price series commenced more than twenty years ago. In June prices moved up by an average of 2.7% from May 2013 pricing and some companies have already announced further price increases for the coming months.
The higher prices being paid for milk is not yet being reflected at the retail level. Pasturised milk prices increased by 2.6% in the 12 weeks to 7 July 2013, reports the Kantar Worldpanel. During the same time pasturised milk sales have increased while the maket for Soya milk has shrunk.