Supply increases more than expected, and price rises only 1.3%

Cepea, August 5, 2024 – Cepea surveys show that milk prices rose in June for the eighth consecutive month, but at a lower intensity. The increase against May was only 1.3%, in real terms, closing at BRL 2.7524/liter on the net “Brazil average”, 3.25% more than that in June/23. However, the average of the first semester, of BRL 2.46/liter, is 14.3% below that verified in the same period last year (IPCA – June).

The fact that prices rose at a lower intensity in June/24 is explained by the above-expected supply increase in Brazil. Despite the delay of the crop in the South and the dry weather in the Southeast and in the Central-West, the milk production has been growing due to investments of producers in the nutrition of the animals, encouraged by the profit increase over the last months. The Cepea Milk Production Index (ICAP-L) upped 4.14% in June.

Besides the production increase, imports of dairy products rose 22% from May to June, totaling 182 million liters, according to data from Secex. This amount is almost 14% smaller than that registered in the same period last year; however, considering the first semester this year, purchases are 1.4% higher.

(Cepea-Brazil)