European butter mountain almost melted

The European Union has substantial stocks of skimmed milk powder. According to recent measurements, more than 357.000 tons of skimmed milk powder were stored in May. Those are the highest levels in 20 years. The butter stock, on the other hand, has almost melted. 

The reason for the high stocks of skimmed milk powder in intervention is that Brussels buys and stores, but does not sell. At least, it hardly sells. Since December last year, only 140 tons milk powder sold. Daniel Rosario, spokesperson from Brussels, says that the European Commission is reluctant to market skimmed milk powder.

France has the largest stock
In May, the intervention stock of skimmed milk powder was 357.496 tonnes. France has the largest share of the stock, with over 67.000 tons, followed by Belgium and Germany. 30.955 tons were stored from the Netherlands in May. In the first half of 2017, inventories mainly increased. According to Rosario, it is difficult to indicate when the stocks can be reduced and sold.

Private storage
In addition to the public stocks, which are in the hands of the European Commission, there was also 37.618 tons in private storage in May. The product then remains in private hands, but the storage is subsidized with European public money. The public and private stocks together mean that the total stock of skimmed milk powder in May amounted to more than 395.000 tons.

Butterberg melted
In one year, the butter stock has decreased by more than 91.000 tons to 1.369 tons. There is therefore no longer any question of European butter mountains. The reason for the dwindling stock is the good demand for butter. Typical for this is the Dutch butter price, which has risen by 92% in one year to €6.190 per tonne in week 30 of 2017.

Wouter Job

Wouter Baan is Head of Meat & Dairy at BoerenbusinessAt DCA Market Intelligence, he focuses on dairy, pork, and meat markets. He also monitors (business) developments within agribusiness and interviews CEOs and policymakers.

w.baan@boerenbusiness. Nl

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