Inside Milk
Wider range reduces room price
The day after the turn of the year, cream prices in Europe picked up strongly, but this movement is now followed by a correction. The value of milk protein, on the other hand, is increasing all the time.
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Cream is demanding attention on the spot market this week. After a few sharp price increases, the DCA cream price shows a decrease from €200 to 4.900 per tonne. This is the result of a wider supply by producers from Poland, Germany and Italy. Due to the high prices, various dairy manufacturers have skimmed extra volumes and are now selling them on the market.
The price drop is seen by various traders as a correction to previous price increases; it is not so much a harbinger of significantly lower prices. Based on the butter quotation, cream charges interestingly and that could put a floor under the price in the short term. However, the cream price lacks some support from the fresh segment and that explains the erratic movements.
Milk protein is rising in price
In the background, the price of skimmed milk concentrate is increasing. The DCA quotation increases by €100 to €1.500 per tonne. The milk protein benefits from the rising price of skimmed milk powder. In principle, the price can only rise now European intervention stocks almost finished. Prices in the European Union are considerably lower than, for example, New Zealand or the United States. This provides a competitive advantage in the global market.
Rising protein prices and falling fat prices leave the spot prices of raw milk cold. In the Netherlands, the DCA quotation remains at €35 per 100 kilos. In Germany, prices are slightly lower compared to last week. By the lower milk supply the traded volumes are relatively small.