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AMPE and MCVE updated to reflect latest costs in Q4 2024
Thursday, 24 April 2025
Processing costs for dairy products were subject to inflationary pressures in the fourth quarter of 2024, reducing the value of our market indicators AMPE and MCVE. These changes will be implemented in our latest publication on 25 April.
In Q4 2024, electricity increased by 6.2% and gas increased by 5.3% compared to the previous quarter. Overall inflation (as measured by the Consumer Price Index) increased by 1.1% compared to the previous quarter. Comparing year-on-year, overall inflation rose by 3.5%, while electricity and gas were still significantly cheaper – by 9.0% and 24.7% respectively.
The net impact of the latest quarterly cost increases is for the average processing costs within both AMPE and MCVE to rise on the quarter. Overall, AMPE costs are now 0.21ppl higher and MCVE costs are 0.22ppl higher than the previous quarter.
The increase in gas and electricity prices and overall inflation were the leading factors which impacted the overall cost. Energy prices continue to remain at relatively high levels. When comparing with average processing costs in Q4 2023, AMPE costs have declined by 0.52ppl and MCVE costs have eased by 0.45ppl in Q4 2024.
Note that this latest update only reflects inflation to December 2024, including data revisions. Labour costs have been carried over from Q3 due to a delayed data publication from ONS. The next update will be in July 2025 following the ONS release of the 2025 Q1 cost indexes. A breakdown of the latest costs is given below:
The new costs include changes in:
- Energy costs based on the movement in the average prices of gas and electricity purchased by the manufacturing industry in GB as quoted by BEIS, up to Q4 2024
- Labour costs carried over from Q3, based on the movement in the unit labour cost for the whole economy as quoted by ONS – due to a delayed data release Q4 2024 data was not available at the time of this publication
- Other costs based on the movement in inflation (CPI)from the 2020 update to Q4 2024
For further changes and to see how costs impact your own business, we offer an online spreadsheet that allows you to enter bespoke costs and milk quality into the calculations. This will then calculate unique indicators based on your own circumstances.
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