Sekretariat

Birgit Prietzsch
Institut für Marktanalyse

 

Bundesallee 63
38116 Braunschweig
Telefon: +49 531 596 5302
Fax: +49 531 596 5399
ma@thuenen.de


Pricing in dairy markets: who dictates and who reacts?

Project

 (c) BLE, Bonn / Thomas Stephan

Price Formation on Dairy Markets: Who determines and who reacts?

The world is global – and the milk market too. What happens in Germany, if a "milk can" tips over in New Zealand? How are producer prices and how are price for consumers determined?

Background and Objective

With the withdrawal of EU agricultural policy from direct control of markets, price fluctuations at world markets can directly affect the German milk and dairy markets. This new development has consequences for the price formation in the dairy supply chain – beginning from milk producers, milk processors and retailers up to consumers. But who benefit and who loses under this new policy?

Our analysis show how price signals are transmitted from one stage to the next stage to draw conclusions about the organizational structure of the dairy value chain. This work helps to understand the market power and the exploitation.

If we understand the principles of price formation in a value chain, we can properly assess what possible consequences policy changes have. Results from this project are used to better advise the policy in the area of milk and dairy.

Approach

Long-term time series on German, European and international prices are the base of our work. In our analysis we cover the main dairy products, such as butter, cheese, skim milk and whole milk powder.

Raw milk is processed to various dairy products which do not stand alone, but are connected through complementary or substitutive relationships in different markets. These market interactions need to be captured in our comprehensive analysis which contributes to a better understanding of domestic and international markets for milk and dairy products.

Preliminary Results

Our preliminary results indicate that the pricing in the German dairy supply chain has changed significantly under the reform of EU agricultural policy: The world market became more important while the influence of milk producers has decreased.

Thünen-Contact


Involved Thünen-Partners


Involved external Thünen-Partners


Duration

4.2011 - 12.2018

Publications

hits: 4

  1. Weber SA (2015) EU-Milchmarkt auf dem Weg in die Freiheit : Umgang mit Preisrisiken stellt Erzeuger vor Herausforderungen. In: Trendbuch : Innovative Agrarwirtschaft 2015. Frankfurt a M: Deutscher Fachverl, pp 13-16
  2. Weber SA, Koch J (2015) Nur noch mehr Bürokratie [Interview]. DLZ Agrarmag(2):23
  3. Weber SA, Salamon P, Hansen H (2013) Volatile Weltmarktpreise von Milchprodukten und ihr Einfluss auf die nationale Preisbildung: Der deutsche Käsemarkt. Landbauforsch Appl Agric Forestry Res 63(2):103-114, DOI:10.3220/LBF_2013_103-114
    pdf document 1295 kb
  4. Weber SA, Salamon P, Hansen H (2012) Volatile world market prices for dairy products - how do they affect domestic price formation: the German cheese market : paper prepared for the 123rd EAAE Seminar Price Volatility and Farm Income Stabilisation ; Modelling Outcomes and Assessing Market and Policy Based Responses, Dublin, February 23-24, 2012 [online]. Dublin: EAAE, 17 p, zu finden in <http://purl.umn.edu/122542> [zitiert am 26.06.2012]
    pdf document (limited accessibility) 234 kb