Why milk rose 25% in August and is the food that has become more expensive

The latest data from the National Institute of Statistics (INE) indicate that inflation, despite having moderated in August, still fired. Last month it grew by 10.5%, mainly due to the rise in food prices, with almost 14%. Nevertheless, the case that stands out the most is that of milk: in one year, its price has risen by more than 25%.

Why? As EL ESPAÑOL-Invertia has learned, Spain has lost in the last year almost 7% of farms dedicated to dairy cattle Y total milk production has fallen by 3%. A lower availability of the product that is fundamentally due to the rise in production costsespecially from feed after the war in Ukraine.

These are some of the reasons that have led to milk to be placed as the food that has become more expensive in the last year. Specifically, its price has increased by 25.6%, according to the National Statistics Institute (INE).

[La inflación ahoga a los ganaderos: los costes obligan a sacrificar antes a los terneros y se teme escasez de pollo]

The lower milk production has translated in an improvement in the price per liter received by farmers. In just one year, its price at origin has gone from 32-33 cents to 44-45 centsaccording to the agrarian organizations consulted.

A cost that has been passed on to supermarket shelves and that has its origin, in addition to less product availability, in a rise in input prices used by farmers, especially feed.

Following the Russian invasion of Ukraine, the price of grain fed to cows skyrocketed and even there were weeks of tensions due to his availability until imports from other countries were made more flexible.

Specifically, the complementary feed for cattle has risen 39% in a year Y 80% compared to August 2020. In the case of the complete ration, the ton of feed went from costing 246 euros to 324 today, that is, 24% more. Compared to its price two summers ago, feeding the cattle costs 32% more.

I think

One of the keys to the rise of this product is that its price started from a very low starting point. In fact, a total of 788 dairy farms closed during the last year and the total liters of raw milk fell by 3%, according to data from the Ministry of Agriculture.

The prices received by farmers per liter have gone from 32 and 33 cents to 44 and 45. “In recent days, contracts have been closed for more than 50”explains to this medium Gaspar Anabitarte, the head of the COAG dairy sector.

Another of the factors that has influenced this increase is, according to UPA, that “the Law of the Chain is beginning to be noticed”.

“White label contracts are closed in which the base price of what it costs to produce milk is taken into accountalthough it is a rise that is insufficient when compared to the costs that farmers have had,” they say from the agrarian organization.

How much has risen in the ‘super’

Milk has risen 25.6% compared to its price in August 2021. The highest rise has been recorded during this year: from January to August it has cost 19.4% more.

Furthermore, its upward trend continues. From July to August, the cost has increased by 2.5%. Breeders confirm this trend: “Contracts are already being closed for 50 cents a litercompared to 44-45 in recent months”.

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