In the 30° edition of the digital newsletter for the dairy sector, we can access the update in the month of OCTOBER 2019 the calculation of Reference values of the liter of raw milk developed under the convention INTA-IAPUCo, a work that constitutes a contribution unreleased and featured to generate transparency for the stakeholders of the Dairy Chain. All values presented here were adjusted for inflation rate wholesale using the IPIM (Index of Wholesale Prices Internal) of the INDEC becoming the current prices published by IAPUCo in constant prices October 2019. This helps for a better understanding of the factors operating in the market.
We present the graph that summarizes the dynamics of the supply and demand of the dairy market argentino in the past 36 months. Remember that this information should not be taken as a data point accurate given that it arises from more than 500 models evaluated, and presents a large scatter. It is rather a novel tool for actors in the sector to be ORIENTED to interpret what happens between the supply and demand of milk and observe the TREND that the market holds.
The analysis starts in November of 2016. Up to march 2017 is a sample of the period lose-lose that covered the 19 months prior to the start of this convention where the price paid for the raw material (blue line) was not covered by the values that are needed to cover the costs of production of the raw material (dotted line) and exceeded also the possible values of pay for the milk (red line for the Mega and Large-scale Industry and yellow to the Small and Medium-sized dairies). From April 2017 until September 2017, the system generated net positive. But as of January 2018 the costs of producing milk copied the evolution of inflation while the price received by the producer as well as the reference values in industrial lost purchasing power of accumulating negative balances up to march 2019, a month, from which, and after 16 months, the chain began to accumulate positive balance.
For October 2019, the price of milk to the producer fell in their purchasing power after 6 consecutive months of suba, where in constant currency in the months of June and July 2019 reached 18,53 and 18,55 $/lt respectively. In the middle of spring, the demand (the Big industry, with a buying power in excess of what you pay for, and Smes are complicated) is still observing the evolution of the production (grey line), the domestic consumption and export business in the midst of uncertainty with respect to the foreign policy that might bring the new administration.
