The question is no longer if the price of a carton of milk or a package of yogurt will continue to rise, but when. For several months, French milk has been among the cheapest in the European Union. Before the great heat waves, French breeders sold their production for around 43 cents a litre.
At the same time, across the Rhine, manufacturers and big retailers agreed to pay German breeders 9 cents more. And this, while a few years ago, German milk was much more affordable than French.
The price doubles in Germany
But in the space of a year, the price differences between European producers have continued to grow. German dairy producers were able to pass on price increases of close to 50%. And their Italian counterparts, whose milk is today one of the most expensive in the EU, have benefited from an increase of more than 40%.
At the same time, in France, the price per liter paid to breeders only increased by 23%. A price increase with which farmers in the organic sector would have been content since they have to agree to sell their production at a price slightly lower than last year (-1%). So much so that their milk, in the absence of sufficient demand for AB labeled products, is sold at the same price as that of their colleagues who have remained in the conventional sector.
Sky-high production costs
However, all of these breeders face an exceptionally large increase in their production costs. First, there is the cost of feeding their herds, which supplements what they can produce themselves. Last May it cost them 26% more than a year before. Then there are the fertilizers needed for the production of plants on your farm (corn, hay, rapeseed, etc.) that your cows feed on. In the space of a year, its price has more than doubled (+130%).
And to run your farm machinery, you need fuel. Although it currently benefits from reduced taxation and its price has fallen in recent weeks, off-road diesel today costs 70% more than in August 2021. Added to this are the consequences of the drought. The cows no longer have anything to graze on the meadows, even in the mountains. Livestock farmers are forced to draw on their fodder reserves, increasing the risk of later shortages.
Farmers forced to reduce their herds
Also, with these repeated heat waves, the cows produce less milk. In the three southernmost regions of France, milk collection fell by 5-6% compared to last year. Farmers are really in a critical situation. Some are resigned to reducing their herd, sending cows that are still old enough to produce to the slaughterhouse. Which lowers your cost and generates some cash.
Therefore, raising the price at which manufacturers pay them for their milk appears to be a vital emergency. This obviously assumes that the prices of dairy products paid by consumers increase. In its latest price surveys, the INSEE pointed out that, on average, semi-skimmed milk cartons cost 4.5% more than in June 2021, that is, a few cents more. The same happens with yogurts (+4.5%).
Cheese, for its part, experienced a slightly higher price increase (+6.4%). But all of these increases seem clearly insufficient to enable dairy farmers to make their farms profitable today.
Source: BFM TV
