The margins are slim: Last year, dairy farmers received 56 cents per kilogram, spending 48 cents on production.
In 2022, the price for dairy had increased by 38%, but this was accompanied by rising costs, says Guy Diderrich, President of the Luxembourg Dairy Board: “2022 was the last time we had a cost-covering milk price.”
Meanwhile, producers are feeling the impact of long-life milk alternatives, powders and plant-based milks.
Luxembourg’s dairy farmers sell their product to four main wholesalers, one in Luxembourg and three abroad, who adjust their purchasing price based on global prices, explains Diderrich.
“In the last 3 months, the price of milk has dropped by about 12 cents. And I produce 750,000 kilos of milk a year here on the farm,” says dairy farmer Guy Meyers from Cruchten, who has been in the business for 31 years. This results in a €90,000 drop in revenue.
While energy prices have decreased, other costs like animal feed remain a large proportion of total expenditure, says Diderrich.
Luxembourg currently counts 585 dairy farmers.
Video report in Luxembourgish:
