Inside: Dairy Market
Extreme cold US: also consequences for dairy
The northeast coast of the United States (US) has recently had to deal with extremely cold winds and temperatures that are attacking the record lows. It is not without consequences. Dairy farmers also notice that the low temperatures have an effect on the farmyard.
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The Midwest and Northeast of the US continues to be plagued by periods of extremely cold winds. Winter is in full swing and this has consequences for the export of soy meal. The winter weather has not done logistics any good, making Brazil more popular again and prices there rising.
Energy for other things
The weather can also have consequences for milk production. When it gets too cold, the cow will use its energy to keep warm. This is at the expense of milk production. "In the region from New Mexico to New York, the cows and their owners are dealing with harsh conditions. It will probably impact production per cow, resulting in fewer surplus liters. Compared to last year, they will will in any case be lower," according to the Council of Milk Producers.
Significant minus on the daily market
The timing of this is convenient for the dairy sector. This is because the milk on the daily market sells for a significant minus, compared to the so-called Class III. It is a search for processing. This appears to be particularly helpful to cheesemakers in the Midwest.
This immediately indicates that many liters of milk go to cheese production. Cheese production increased again in November, reaching a plus of 2,8% compared to last year. In addition, exports for November also showed a plus of 17,2%.
It is still doubtful whether the Americans can maintain export volumes. This is because price reductions in the European Union (EU) make the region competitive. However, the US has been helped by the fact that the dollar has fallen in value.
Market remains difficult
The influences of the weather are insufficient to make the market healthy again, unless the extreme weather continues for a long time. "The current price level is causing dairy farmers to record losses. Cattle sales and slaughter are likely to increase in the course of 2018. It lays the foundation for recovery."
As support, reference is made to the domestic economy, but also to other economies that are growing. The big difference with 2009. This means that demand has a strong bottom and this supports the milk price. So even though the milk price will fall, the dramatically low prices of 2009 are not in line with expectations. 
The difference between the European and American milk prices is growing again.