Valio cuts milk producer prices again

Finnish dairy giant Valio has reduced the price it pays milk producers by 3 cents per litre starting 1 July, citing global overproduction as demand fails to match supply.

The move follows a 3.5 cent cut earlier this spring. Valio, a cooperative owned by 13 Finnish dairy associations and 3,000 producers, said world market prices for dairy have been falling since last autumn, with butter prices halving.

Producers say the cut could cost a farm producing a million litres €30,000 a year. Kirsi Vuoriluoma, a dairy farmer and chair of the local milk producers’ committee, said rising costs for fuel, fertiliser, and equipment have squeezed profitability to the point where many may not survive.

Tuomo Mäkinen, a board member of the Milk Producers’ Association, warned that when the market leader cuts prices, others will follow. He noted that consumer prices are unlikely to drop as a result.

Ulf Jahnsson, Valio’s primary production director, acknowledged the strain on producers, with 7–8% leaving the sector annually. The company has launched a programme to support young producers and is targeting €88 million in savings by 2028.