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Prices have risen due to energy, diesel and electricity costs, but consumers react well. Cheese is also more expensive and the price of butter has reached record levels.
The price of milk and dairy products has risen in recent months, a trajectory that could continue in 2025 if the value of production factors continues to increase, Fenalac pointed out, awaiting responses from the secretariat.
“These increases have to do with the law of supply and demand. Seasonally, it is normal for this to happen, but this year there is this correction across the entire sector because the production factors are also more expensivenamely the costs associated with energy, diesel and electricity”, said the president of Fenalac – National Federation of Milk Producers Cooperatives, Idalino Leão, speaking to Lusa.
For Fenalac, the weakest link in the production chain is always the producer, the first to feel the impact of the increase in production factors. Therefore, he argues that predictability and stability are necessary for the three links of this business – production, distribution and consumers -, as has been happening. Without economic sustainability, the abandonment of activity will increase which, consequently, calls into question the country’s food sovereignty.
New generation of producers needed
Idalino Leão also mentioned that this is “an important time to make decisions”, considering that a Most producers are in a high age grouprequiring generational renewal, which does not happen if the business is not profitable.
Although the amounts currently being paid to producers are higher than what occurred a few years ago, there are Member States and “other geographies” that charge higher amounts.
However, Idalino Leão reinforced that it is important to have a balance and join forces so that the sector and its workers have a perspective for the future. “I would not like distribution to be tempted to give in to some cheaper milk offer which, at the moment, is also difficult”, he highlighted.
Prices will rise in 2025 if…
Fenalac said that consumers, who are decisive in the sector’s choices, continue to “react positively” to the consumption of dairy products. Still, he noted that the geopolitical context is complicated and that the dairy sector is no stranger to this issue.
Asked about the possibility of prices for the final consumer increasing again next year, Idalino Leão said that if production factors register significant increases, the value of products will also increase.
“I hope and wish that our guardians take care that all links have the necessary security to produce safe and healthy goods for everyone, but also that their sale and acquisition by consumers is assured”, he added.
The Food and Agriculture Organization of the United Nations (FAO) world food price index rose in November 2024 to the highest level since April 20230.5% more than in October.
According to the agency, the price index reached an average of 127.5 points in November, 5.7% more than a year agobut still 20.4% below its peak in March 2022.
The dairy product price index maintained an upward trend and increased 0.6% compared to October, a trend marked by the “recovery in global demand for whole milk powder imports”.
More expensive cheese. Butter price at record levels
The increase is also recorded in the prices of butterwhich reached a new record level in a context of strong demand and scarce supply in Western Europe, while oil prices cheese increased due to limited availability of products for export.
The price of milk purchased from individual producers on the Continent reached 0.458 euros per kilogram (kg) in October (latest data), the highest value since January, according to data from the Office of Planning, Policies and General Administration (GPP).
In turn, Flemish cheese (when leaving the factory) reached, in November, the highest value of the year, reaching R$ 687.18 per 100 kilograms (kg).
The average weekly price of butter (ex leaving the factory) was, on November 25th, R$711.13 per 100 kg, above the R$682.15 recorded on November 18th.
