Here we present the evolution of the price of milk to the producer, and the main inputs that affect the dairy industry in Argentina, Brazil, Chile and Uruguay. In this monitor regional follow the evolution of the relative prices of key inputs that affect the activity of dairy production in the region as it is the Corn (the thermometer features food that takes more than 50% of the direct costs), the Diesel (impacts minimally on a 15% on cost of production), the Us dollar (more than 70% of the inputs of the activity listed in dollars), the Soy (the value of which affects the protein source of the rodeo dairy and, in almost all cases, the payment of the rent of the land in production (for the chilean case we use Wheat in place of soy) and the price of milk.
Then you will find a graphic with the Evolution of the Index of Costs compiled for ease of comparison, and also a comparison chart with the relative evolution of the producer prices by country. Finally a graph of input/output showing the pounds of corn that can be purchased with 1 lt of milk in each of the countries, as well as the current values of milk and corn to the producer.
We use the month of January 2023=1 as a starting point for the evolution of relative prices. Graphics importantly, the stability of costs of power for all but Argentina that with inflation and the “dollars Soy” and now “dollar Agro” and finally the correction of the type of change made by the new administration desconfiguró the curve with a sharp increase in costs. It is remarkable the balance uruguayan, although in all cases the milk lost ground against the dollar. On the other hand, the price of milk to the producer remains stable for Chile and Uruguay, while Brazil has a turning positive after the fall spring and Argentina in recovery coming out of the well pos-devaluatorio. In any case, the chilean producer and brazilian perceive the best prices: 0,442 and 0,452 US$/l, respectively. The argentine case is marred by a scenario of high inflation, annual (288%), compared with Chile (3,7%), Brazil (down 3.9%) and Uruguay (3.8%) and which complicates the analysis.
In the following charts, we see a compilation of the data generating the Index, Cost/Price and the Rate of milk Prices in us $ /litre. In the first (the evolution of domestic prices to costs related to the local value of the milk) we can observe that the argentine producers are those who have most suffered from the higher relative costs whose values in litres of milk grew strongly since the mid-2023 and recently in December and January 2024 began to decline, reaching in march the regional level.
In terms of food costs, that became more expensive regionally, this time the producer with the corn more expensive was the uruguayan in with 1,72 kg corn/liter of milk, followed by the chilean 1,91 kg, Argentina with 2,09 kg/lt, and Brazil, the best relationship, with 2,14 kg of corn/lt of milk. The calculations correspond to February 2024, month that we have the price of milk to the producer of the 4 countries.
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