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Arla cutting January pay price

Denmark-based Arla Foods is cutting the price it pays for milk in Europe by 2 pence per liter in January. That will put the pay price for U.K. producers at 24.81 pence per liter compared to 33.84 pence per liter last January.  Arla has 35,000 farmer-owners.

Arla joins a number of European milk processors who have been steadily lowering prices since February in response to the global dairy market. Hopes are the 2.4 percent increase in the last Global Dairy Trade index on December 16th is an indication that the bottom is near.  The GDT index has lost almost half of its value since February.

In the U.K., dairy producer numbers dropped below 10,000 for the first time ever in November as farmers go out of business.

U.S. milk prices have been sliding in the last two months in response to the global market. Class III futures for April slipped under $15 per hundredweight on Tuesday compared to the record Class III base price of $24.60 paid in September.