Dairy Today's European correspondent Wilfried Wesselink reports a lot of ups and downs in the European Union's (EU) milk production this summer.
In Britain, June milk production was down 2% compared to last year, despite the fact that milk prices have jumped 30% from a year ago to $20/cwt. One problem: Britain's farmgate milk prices are backing off from about $22/cwt last November.
Germany has seen its milk prices increase 10% in the past year. But now a German anti-trust agency is investigating whether farmers manipulated prices. "The agency is very critical about initiatives from German farmers who market their milk cooperatively to get higher prices,” says Wesselink. German consumers are already wary of the higher prices: They bought 3% less cheese during the first half of 2008.
In the EU as a whole, milk production is up 2.2 billion lb. in the first six months of 2008. That's a 0.9% increase over the same period last year.
Still, European economists predict EU share of the world dairy market will decline over the next decade. It predicts New Zealand will gain market share in butter and milk powder and the United States will gain share in milk powder.