Inside: Dairy Market
Bargain price of milk high, but not very high
Everything that contains milk fat is scarce and therefore popular. However, milk prices are not completely through the roof. This is because dairy farmers only buy when the processing into dairy products is somewhat profitable.
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Milk remains a popular product in Europe. Dairy processors are facing a shortage of milk and are therefore buying more than selling. This ensures that the available volumes on the spot market are small. The DCA quotation for raw milk in the Netherlands (delivered at 4,4% fat) is, just like last week, €43,50 per 100 kilos. However, there are occasional outliers, both upwards and downwards.
Alleged prices, which exceed €45 per 100 kilos, are not representative of the raw milk market. Trading takes place very sporadically at those levels. In Germany, volumes are also thin with unchanged prices. In Northern Germany, €3,7 is charged (at 41,50% fat, delivered). In southern Germany the price is €0,50 higher.
Room price hits block
The cream price is moving closer to €8.000 per tonne every week. At that point, the cream price will probably hit a significant bump, because a psychological boundary will have to be crossed again. A freight room currently contains double the amount of capital compared to 1 year ago. This once again underlines the enormous amounts of money being circulated. At the beginning of the week, the cream price continued to increase. As the week progressed, the price leveled off slightly. The DCA cream price comes to €7.800 per tonne (+€250) and feels fixed.
Next week there will still be a holiday atmosphere and trading activities on the spot market will probably increase again from week 34. It remains to be seen how the cards will be dealt. The correction that skimmed milk concentrate made last week turned out to be slightly exaggerated. This week the price rose again to €1.620 per tonne (+€70).
1.620
euro
Powders remain weak
The hope among dairy processors is that a lot of milk will flow into cheese by mid-August. This relieves some of the burden on the production of milk powders. Both whole and skimmed milk powder are having a hard time. Competition on the world market is fierce and intervention stocks in Brussels are still hanging above the market. These stocks will have to hit the market at some point, with a view to their shelf life. At least, that is the thinking among powder manufacturers.