Spot price of milk is skyrocketing

For the umpteenth week in a row, there are sounds from the field that indicate lower levels in the milk, especially the fat is disappointing. In week 20, a cause can be carefully sought in the warmer weather, but perhaps there is something more going on. Without drawing firm conclusions, it is striking that the lower levels coincide with less phosphorus in the concentrates. 

Does Ascension Day have an effect?
It appears that the levels will continue to be lower in the remainder of 2017. At the same time, both France and Germany are producing significantly less milk compared to last season. Add to that the increased butter price on the Global Dairy Trade (GDT) and the answer emerges. The broken week, due to Ascension Day, does not hurt the market. 

After the butter price (under the influence of sufficient demand), the cream price is also heading for a record. For week 20 this amounts to 6 euros per kilo ex factory. Due to the rapid increase, a pause is realistic, but after that various players indicate that there is still room for higher prices. 

Higher cheese prices
Not only butter achieves good results. Gouda and mozzarella join in. The first one goes up to 3,20 to 3,30 euros per kilo ex factory. The second rose from 3,20 euros to 3,49 euros per kilo. The prices are for delivery in June and July. A nice detail was that cheese exports from the EU reached a small record in March. The last time this worked was in the fall of 2012. 

There is still a similarity with 2012. This is evident from the trend in the price for raw milk. In the Netherlands, this increases to 36 euros per 100 kilos of milk, delivered at 4,4 percent fat. Also in 2012, the price started to rise around week 19 and continued to do so until September. The increase continued for even longer in 2009 and 2016. However, as far as historical data can be relied on, an increase early in the season usually guarantees rising prices. 

Little demand from Italy
Italy also plays an important role in Germany. The little demand from that region keeps the price in the south at 33 euros per 100 kilos of milk, delivered at 3,7 percent fat. The North records a price of 35 euros per 100 kilos of milk, at 3,7 percent fat. There is hardly any trade.

Skimmed milk concentrate closes the ranks with a price of 1.700 euros per tonne of dry matter. This will quickly reduce the gap between the price of skimmed milk powder and concentrate. The market remains steady and heads towards an undisturbed Pentecost. 

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