An accentuated drop in Brazilian milk production has pushed dairy prices up in the country, according to a recent study published by the Centre for Advanced Studies in Applied Economics (Cepea).
Prices paid to producers rose in February by an average of 2.2% compared to January and 17% compared to the same period the previous year, closing the month at BRL 1.21/litre. Taking into account freight and taxes, the average gross price in February was BRL 1.32/litre, 18% higher than in February 2016.
According to Cepea's researchers, the milk supply drop is due to the recent excess of rain across the country, as well as a lower investment in milk production - including the reform and maintenance of pastures, as well as the purchase of animals and medicines. Last year, Brazil registered a surplus of milk, bringing prices down.
Specialists expect the prices to continue rising in March, as demand is steadily growing and production is said to remain low. However, in the long run, price increases are expected to slow down and stabilise.
Brazilian Milk Products
As for Brazilian milk derivatives, the price of UHT milk rose 4.33% from January to February in the state of São Paulo. In 2017, the increase has reached 9%.
After six months of decreasing prices, due to the low demand, the prices of cheese saw an increase of 1.94% in January.
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Josiane Lang. Click subscribe to sign up to ESM: The European Supermarket Magazine.
