Special market takes revenge on cheese price

The milk supply in the European Union (EU) moves (seasonally) around the lowest point. If you add the upcoming holidays, it is clear why prices are rising in the run-up to the end of the year. This increase is fully reflected in the cream price, where an increase is visible from €5,93 per kilo to €6,30 per kilo. The butter price is estimated at €5.100 per tonne and the trend is increasing.

Gouda in a minor key
Cream and butter do what they are supposed to do, but this does not apply to cheese. On the German stock exchange the price fell to €3,30 to €3,40 per kilo. The stock is described as normal. Inquiries among market players show that this stock is not normal for this time of year. Cheese stocks were built up in the summer and they now have to find their way onto the market.

This is probably also the reason for the negative sentiment and falling prices. For example, Gouda and Edam foil charge a price of €2,50 to €2,60 per kilo. The breads are at the bottom of the price range, the Antjes at the top. However, there is no bottom yet, because cheeses are also sold at lower prices. It is difficult to say where the bottom will be. In the meantime, cases are already taking place for the first quarter of 2018.

Gap between milk price and spot milk is growing
A weak cheese market undermines the positive effect of rising butter prices. As a result, it cannot be anything other than that processors lose money. This is because dairy farmers still receive a good milk price. Rapid reductions are unlikely, because processors look at each other and want to keep members satisfied.

Meanwhile, the price for Dutch spot milk drops to €30 per 100 kilos (delivered at 4,4% fat). It is a result of maintenance at the processors and disruptions at a number of parties. In Germany the problems are somewhat less prevalent. In the north, the price remains at €34 per 100 kilos (delivered at 3,7% fat), compared to €35 per 100 kilos in the south of the country.

Prognosis
More milk will slowly come again in the coming weeks. In the Netherlands, livestock farmers are indeed suffering after losing the light touch and thus the exemption from the phosphate reduction plan. How this will translate into the total milk pool is guesswork. 

DMK promised to keep the milk price stable until the end of the year. The Germans also managed to secure the so-called white line for 6 months, and the cream will remain in place until January. For the time being, it provides a stable forecast of the milk price. 
The spot milk in relation to the milk supply in the Netherlands.