Brazil milk price rises for second month in a row - Cepea

 The price of the milk produced in December/23 in Brazil rose for the second time in a row (+1.2% against November), on the “Brazil Average”, according to figures calculated by Cepea, closing at BRL 2.0335/liter. 

The average in 2023 was BRL 2.4680/liter, being 14% lower than that in 2022, in real terms (values deflated by IPCA December/23).

Price rises in December/23 are related to the limited supply, which has been increasing the competition among dairy companies. The Index for Milk Production (ICAP-L) calculated by Cepea moved down 1.64% from November to December. Weather issues and producers’ restricted margins explain the lower milk production.

Milk price rises to producers did not result in increases for byproducts. Players surveyed by Cepea say that dairy companies were not able to transfer increases due to the pressure for lower quotations, the fierce competition among companies to sell dairy products and the competition with imported goods.

Imports of dairy products rose 10.5% in December, hitting 226.2 million liters, the biggest volume since September/2016, according to data from Secex. In 2023, purchases totaled 2.25 billion liters, for an increase of 68.8% compared to 2022.