Guaranteed price for January: 36.50 euros

2 January 2012


The FrieslandCampina guaranteed price for the month of January 2012 is 36.50 euros per 100 kilograms of milk. The guaranteed price for January is consequently 1.00 euro lower than the price for the month of December 2011 (37.50 euros).
The decline is due to the expectation that the average prices paid in January for raw milk in Germany, the Netherlands, Denmark and Belgium will be slightly lower than the milk prices for December 2011. This results from the traditionally cautious stance taken by the various dairy cooperatives in establishing the first milk prices of the new year.
The fat price in January 2012 amounts to 4.01 euros per kilogram and the protein price is 6.32 euros per kilogram (December 2011: 4.36 euros and 6.16 euros, respectively).

The guaranteed price applies to 100 kilograms of milk with 4.41% fat and 3.47% protein and is exclusive of VAT. The guaranteed prive is the price that FrieslandCampina guarantees to pay the member-dairy farmers for the milk they deliver in the relevant month. This guaranteed price is independent of the result of the FrieslandCampina company.

FrieslandCampina guaranteed price

2012

2011

Per 100 kilo milk

Cumulative average per 100 kilo milk

Per 100 kilo milk

Cumulative average per 100 kilo milk

January

36.50

36.50

35.65

35.65

February

 

35.65

35.65 

March

36.00

35.77

April

36.00

35.83

May

38.00

36.25

June

38.00

36.55

July

38.00

36.76

August

 

37.25

36.82

September

 

36.25

36.76

October

 

37.00

36.78

November

 

37.25

36.82

December

 

37.50

36.88

Prices in euros per 100 kilograms of milk with 4.41% fat and 3.47% protein, excluding VAT. This price does not include additional charges or payments. Fat price January 2012: 4.01 euros per kilogram, protein price 6.32 euros per kilogram.

This guaranteed price does not include the effects of additional payments and charges, such as the quantum supplement and additional seasonal charges and payments. January, February, July and December are ‘neutral’ months in terms of seasonal levies and supplements: these are months with no seasonal levies or supplements. From March until the end of June the summer levy is applicable to the members of FrieslandCampina (2.30 euros per 100 kilos of milk). The members receive a seasonal supplement of EUR 2.45. After settlement of additional payments and charges, the cash payment in January for a dairy business with 500,000 kilogrammes of milk is 36.15 euros per 100 kilogrammes of milk, exclusive of VAT.(December 2011: 37.22 euros)

FrieslandCampina milk price consists of  guaranteed price, performance payment and the registered reserves
The milk price FrieslandCampina pays its member dairy farmers for the milk they supply consists of the guaranteed price, annual performance payment and the registered reserves (issue of fixed member bonds).
The guaranteed price is not linked to FrieslandCampina’s result. We base the guaranteed price on the average milk price for Germany, the milk price of Arla Foods in Denmark, the milk prices of Bel Leerdammer, Cono Kaasmakers and DOC Kaas in the Netherlands and the milk price of Milcobel in Belgium.These are the average annual prices, including payments in arrears and registered reserves.  These prices for raw milk are representative for the country concerned. In order to calculate the FrieslandCampina guaranteed price, we weight these milk prices for the volume of milk processed in the entire country in question. In total, this involves about 45 billion kilograms of milk. Each month, the guaranteed price consists of the expected guaranteed price in the relevant month and any settlement of differences in expectations from preceding months.
Unlike the guaranteed price, the performance payment and the registered reserves do depend on the financial results of FrieslandCampina and the approved reservation policy.
In principle, we will pay 30 per cent of the company’s result for the 2011 financial year to members as a performance payment in cash and 20 per cent will be added to registered reserves in the form of fixed member bonds. Both are paid out annually, after the approval of the company’s financial statements, in proportion to the value of the milk supplied.