Brazilian farm-gate milk prices jump 5.4% in February
Supply tightens as weather and thin margins curb production
8 April 2026
1 minute read
By: Farm-gate milk prices in Brazil rose 5.43% in February from the previous month, closing at BRL 2.1464/litre on Cepea's Brazil Average index, according to Cepea. Year-over-year, however, prices were down 25.45% in real terms, reflecting the toll of consecutive price drops throughout 2025.
The monthly gain was driven by competition among dairy processors for raw milk amid tightening supply. Cepea's Milk Production Index (ICAP-L) fell 3.6% from January to February on the Brazil Average.
The production decline stems from adverse weather conditions affecting pasture availability and pushing up feed costs, compounded by farmers' reluctance to invest following a prolonged period of margin pressure in 2025.
On the cost side, the Effective Operational Cost edged up 0.32% in February. However, the exchange ratio improved for producers, supported by falling corn prices and the recent uptick in milk quotations.
