Arla holds March milk price as global supply keeps pressure on markets

Arla has opted for stability in March, holding its milk price as high global supply and soft commodity markets continue to weigh on dairy returns.

The co-operative confirmed its conventional milk price will remain at 33.98p per litre for March 2026, while its organic headline price stays at 57.98ppl.

The decision comes amid signs that global milk supplies have stabilised at elevated levels. Commodity markets are showing indications of settling, but retail prices are still adjusting to earlier declines, with time lags and variation between markets and product categories.

Across Europe, supply remains plentiful. Arla said a market balance appears to have been reached, albeit “on a slightly higher level than expected”, influenced by production capacity constraints.

However, that balance remains fragile. Continued strong output is limiting scope for upward price movement, and uncertainty persists across export and domestic markets.

Organic producers face additional headwinds. Lower sales prices and weakening volumes are eroding profitability across several markets, with Arla warning the outlook remains uncertain.

Meanwhile, First Milk has also chosen to hold its price from March, offering members a measure of stability as wider sector returns come under renewed pressure.

The dairy co-operative confirmed its milk price will remain unchanged at 30.25ppl for a manufacturing standard litre, including the member premium — notably below Arla’s conventional headline price.

The twin decisions suggest a period of consolidation in farmgate pricing, with processors cautious about moving prices in either direction while supply stays firm and demand signals remain mixed.

With European production still strong and organic markets under strain, significant upward movement in the short term appears unlikely.