NEW FIGURES highlighted by the European Milk Board have asserted that the farmgate price being paid for a kilogram/litre of milk in Germany is lagging 9.5 euro-cents – about 8pence – behind the actual cost of production.

The current calculation of German milk production costs shows that in October 2019 only 78% of those costs were covered by returns. According to the quarterly figures published by the Farm Economics and Rural Studies Office, production costs amounted to 43.71 ct/kg (37.4ppl) whereas the farm-gate milk price was only 34.23 ct/kg (29.3ppl)

This cost calculation is regularly carried out for Germany, but also in five other countries – Belgium, Denmark, France, Luxembourg and the Netherlands – where the most recent totting-up clearly showed that milk producers were not being paid cost-covering prices, said the EMB, which is lobbying for a 'legally-anchored' crisis instrument to counteract this chronic cost shortfall.

Its proposal for a Market Responsibility Programme (MRP) would observe and react to market signals by aligning production.