Milk to feed price ratio (MFPR)
Updated 4 February 2020
The milk to feed price ratio (MFPR) shows the value of milk compared with the cost of purchased feed. Feed costs account for around 70% of variable costs. The MFPR gives an indication of inputs costs in relation to income. It is updated on a monthly basis
There are two ratios quoted – the calculated MFPR, which is based on feed prices and projected milk prices, and the actual MFPR, which are provided by Kingshay and Promar Milkminder.
Actual vs calculated MFPR
- The actual MFPR is normally provided two to three months in arrears.
- The calculated MFPR is based on projected farmgate price movements and calculated concentrate prices.
- The MFPR is an indicator only and not a replacement for analysis on the full costs of production.
- The ratio will increase if either farmgate milk prices increase or concentrate prices decrease.
- The ratio will vary greatly from farm-to-farm depending on milk price achieved and type of feed used. The ratio should only be used as a guide to the cost-revenue relationship in the country.