Rising Dairy Prices Boost Swedish Farmers' Profitability

The past year has seen the price of dairy products such as milk, cream, and cheese skyrocket. The compensation that farmers receive has also increased. A milk producer in Sweden currently receives almost 68 percent more payment for the milk than at the beginning of 2021, according to the Swedish Board of Agriculture.

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Rising Dairy Prices Boost Swedish Farmers' Profitability
Photo: Björn Larsson Rosvall / TT

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Dairy farmers have recently received several compensation increases that have benefited profitability, writes the authority in a press release in connection with a report on food consumption last week. Over four years, compensation has increased by nearly 70 percent. However, criticism of the producer level for their price increases has not been as loud as criticism of the food giants.

Anna-Karin Hatt, CEO of the Federation of Swedish Farmers (LRF), thinks that it is entirely reasonable that farmers receive more pay, also considering the price increases on food.

If we want to have more milk production in Sweden, and we do, then profitability at the farm level must increase because we have seen decades of decreasing milk production in Sweden, says Anna-Karin Hatt.

Farms Closed

She says that Swedish dairy farmers previously received far too little pay for milk and that many dairy farms then closed down their operations.

Milk producers, like other food producers, must receive fair pay for the work they do. They must also be able to get economic muscles to be able to invest in both maintaining and developing their production.

The LRF CEO also highlights the importance of Sweden, in these uncertain times, having a food supply preparedness and getting a "sustainable food basket", which requires good profitability at the farm level.

But it also requires investments and the investment space does not exist today. It must be both politics and we as consumers who help create it.

No Margin

Anna-Karin Hatt says that there is no room to lower payments to farmers, despite the recent years' increased compensation to dairy farmers.

Swedish farmers strive every day and have done so for as long as possible to produce as efficiently as possible with as small inputs as possible and as small costs as possible. But currently, there is nothing more to take at the farm level.

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By TTEnglish edition by Sweden Herald, adapted for local and international readers

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