Business and Policy June 2025 – Milk

Milk production data 

With the highest production since 2020/21, GB production for the 2024/25 milk year was 12.44 billion litres, 0.7% above the previous season.  Meanwhile, the latest data from AHDB estimates the GB milk volume for April at 1,141 million litres, 65 mlitres more than the previous April.  Exceptional spring weather and a continued favourable milk price to feed price ratio has led to record April production.  Daily production is currently 38.35 mlitres for the week ending 17th May, 0.7% less than the previous week but 4.5% above the same week last year (an extra 1.66 mlitres per day).   

Grass growth was stalling in early to mid-May under drought conditions in many parts of the country, but the recent rain will help stimulate growth and milk for those struggling with grass.  For the UK, April production was 1,396 mlitres, which is 23 mlitres (+1.7%) more than the previous month and 6.5% more than April 2024. 

Farm-gate prices 

The Defra farm-gate milk price for April was 43.69ppl, down 1.2ppl from the previous month but 14% higher than 12 months ago. It is perhaps not surprising that milk prices are starting to slip, giving the high volumes so far this year and the more pronounced spring flush. First Milk have reduced their June price by 0.5ppl, their first price move since December 2024, athough Müller are continuing to hold their price this month. 

Dairy commodities & market indicators 

Commodity prices have remained steady despite the spring flush bringing milk volumes significantly higher than last year.  Stability in the commodity markets is down to our close ties with the European milk market and stable EU milk production so far in 2025 (with Bluetongue having curbed production in France, Germany, Belgium, and Denmark).  For May, average UK wholesale prices saw very small declines in bulk cream (-3%), mild cheddar (-2%) and SMP (-1%), while butter showed no change from April.  Soaring milk volumes meant that cream was abundant, although butter supplies are still said to be tight.  While domestic availability of mild cheddar is good, EU stocks are limited, helping prevent prices dropping further.  As a result, there was very little change in AMPE from last month, although MCVE saw nearly a 1ppl drop on the back of the slightly lower mild cheddar and whey powder price.  The Milk Market Value indicator dropped 0.77ppl to 42.77ppl for May.  The latest GDT auction on the 20th May also showed a downward trend, with the average price across all products reaching $4,589/t.  The previous three auctions returned a positive change in price.  

 © AHDB [2025].  All rights reserved. 

Antimicrobial resistance in calves 

According to a recent report published by Netherlands based animal health organisation, Royal GD, resistance to the drug paromomycin has increased rapidly.  In 2021, 48% of E. coli isolates were found to be resistant, but the figure for 2024 is now 72%.  The report also reveals increasing detection rates of cryptosporidiosis in calves under two weeks of age and there are concerns that increased use of this medicine could be responsible for resistance in E. coli K99.  Use of paromomycin is often routine on farms with a high incidence of calf scour and the focus should be more on prevention strategies, including good colostrum management, calf pen hygiene and vaccination.  A vaccination for cryptosporidiosis has been available in the UK since August 2024 and requires two doses in the 3rd trimester of pregnancy, four to five weeks apart, with the 2nd dose to be given at least three weeks before calving for transfer of antibodies to the colostrum.    

Rabobank global outlook 

Rabobank are predicting that global milk production in the seven key exporting regions will increase by 0.8% in 2025.  In the US, the EU, South America and Oceana, expansion is being driven by strong milk prices, good demand for dairy products and stable input costs. The positive momentum in milk supplies is also predicted to continue into the first half of 2026. While 0.5% growth is predicted in the EU, Bluetongue could continue to curb growth this summer. Milk production in China is forecast to drop by 2.6% in 2025 on the back of a 15% decline in milk price and herd reductions and so import demand will increase. The biggest growth is forecasted in India (+5.5%), the worlds largest milk producer. Domestic demand is strong, and government support means that the major dairy cooperatives are expanding.  

lorna.macpherson@sac.co.uk