Fixed Price Model
Strong price fluctuations in the dairy sector have been observed for several years now. These market developments pose new challenges for milk producers. As a result, many farmers request more predictability and liquidity protection in these challenging times. Production costs can be planned, for instance, through advance contracts in feed purchasing. The milk price, on the other hand, has not been calculable in the long term yet. Using milk futures is a first step in making these calculations possible.
In order to give our farmers the opportunity to increase their planning security and lower liquidity risks, we introduced our fixed price model in 2021.
Together with established experts we have set up a transparent and user-friendly fixed price platform which gives all interested farmers, regardless of their (production) size, the opportunity to enter into futures and hedging transactions.
The system is designed to give milk producers a better insight into market developments, to increase their freedom of choice and to provide them with risk management tools.
We offer a monthly trading run for a maximum of 12 months in advance. The offered prices are analyzed by us in cooperation with the prestigious ife-Institute of nutritional science. The current market situation as well as market expectations, among other things, are taken into account here.
The ife-Institute is an independent and non-profit research institute founded by scientists of the former Federal Institute of Dairy Research in Kiel.
They publish the “ife stock market milk value” on their website (www.ife-ev.de) daily. Our farmers can also use this information to assess the development of the fixed prices.
Detailed information or participation requests can be obtained directly from our supplier consultant team.