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Milk Trading Company looks ahead after turbulent years

May 7, 2024 - Klaas van der Horst

The Milk Trading Company (MTC) can look ahead again after a number of turbulent years and an internal reorganization. A positive return was achieved last year, and the future is also approached with optimism. This is what new CEO Theo Coppens says.

He was hired as CEO at the end of last year to lead the company further. This happened after Dirck Coucke stepped down as CEO and MTC and advisory organization DLV were separated.

Only an advisor now
Coucke and partner Raf Beyers are still involved with MTC, but only as advisors. They no longer have a role in decision-making, including decisions regarding placing orders to hedge the milk price, assures Coppens. Decisions to hedge the milk price are made by the members in the so-called 'milk chat,' perhaps based on the advice of advisors, but it is the members who make the decisions and pass on the orders to DLV. DLV then forwards these orders to a broker. According to Coppens, the problems with the website for a while had nothing to do with the internal adjustments.

Legal procedure
The MTC that Coppens now leads has lost a third of the once more than 300 members, it is reported. This was because the dairy market in 2021 and 2022 moved completely differently than MTC had anticipated, and members had to pay a lot of additional money. This was because the milk price became much higher than the price at which it was fixed. The departing members no longer wished to bear the losses and left. These members also criticized the dual role that Dirck Coucke had as CEO and advisor at the time.

Some even filed a lawsuit against MTC for alleged wrongful actions. Coppens does not want to comment on this 'because the process is still ongoing.' However, he does want to mention that in recent years, MTC has not violated any licensing requirements when trading on the futures market, neither in Belgium nor in the Netherlands. 'We are not subject to licensing,' he states.

Positive in 2023
Last year, the members of MTC fared better again, according to the organization. In 2023, they received an additional payment of an average of six cents per liter on top of their fixed milk price. Coppens believes that MTC has now overcome the pain. 'That seems to be the case,' he says. The outlook is positive again. Whether new members will be recruited immediately is a question that Coppens cannot answer at this time.

Klaas van der Horst

Klaas van der Horst is a senior market specialist in dairy at DCA Market Intelligence. He also closely monitors developments in politics and agricultural policy.
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