Projected farmgate milk price changes

Updated 24 June 2022

These projections indicate the expected movements in farmgate milk prices for the next three months, based on movements in the dairy markets.


  • Post-peak declines in milk production supported dairy product prices, with butter and SMP both increasing 2% on the month. AMPE also rose 2% as a result, to 56.4ppl.
  • MCVE moved up on the back of higher prices for mild Cheddar, although whey prices declined slightly in June. This resulted in an increase in MCVE to 54.1ppl, up 2% on May.
  • The net impact of these movements on the overall market value of milk (MMV) was an increase of 1.0ppl.
  • While smaller than in the first quarter of this year, the recent upward movements in market indicators still point to support for farmgate milk prices into the summer. However, it must be noted that as the cost elements for processing remain in arrears, current values for AMPE and MCVE will not be a true reflection of current market returns.

Additional information

  • The projected change is based on the strong link found between movements in the value returned to manufacturers from the market (MMV) and movements in farmgate milk prices.
  • On average, it was found that a 1ppl change in the MMV will lead to around a 0.5ppl change in the overall GB average milk price, generally three months’ later.
  • Differences will arise due to the markets in which milk buyers operate as well as the mechanism they use to set the milk price. These will impact the timing of price movements as well as the size of the change.
  • Other factors which are likely to impact milk prices will be the degree of competition for milk in the market, changes to available processing capacity, import competition and contract negotiations.
  • [1] The Milk Market Value (MMV) is a weighted average of AMPE and MCVE on a 20:80 basis. This was found to be the best predictor of movements in farmgate prices based on historical data. The analysis was done excluding prices paid on retailer-aligned contracts. The impact of the adjustment of AMPE and MCVE following the 2020 review has been accounted for, and the model updated.

Visit the UK farmgate milk prices page

Visit the Market Indicators page

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