Inside Milk
Dairy factory more often looking for spot milk
The extreme heat seemed to have no effect on the dairy market, but in the meantime it has become noticeable that the supply of raw milk has taken a major hit. The prices of spot milk are therefore increasing, as are the quotations for cream and skimmed milk concentrate.
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Especially in the second half of this week, interest in raw milk and liquid dairy products has increased. The drought in the past week has severely affected the milk supply. In addition, the fat and protein contents about June got a hit. Several dairies are therefore short of milk. They are now entering the market to keep the factories running. In addition, reference is made to 1 specific party that is looking more often.
The DCA listing of raw milk in the Netherlands thus increases by €1 to €34 per 100 kilos (at 4,4% fat). The statements at DCA-Markets even rose to €36 per 100 kilos, but the averaging did not get that far. The availability of raw milk is expected to increase somewhat due to the cooler weather. This is despite the fact that we are in the period with the seasonal decline in milk production.
Butter prices further down
Cream prices are also rising. The DCA quotation increases by €100 to €3.750 per tonne. However, the upside potential is limited, as butter prices have fallen to €3.200 per tonne. The prices of skimmed milk concentrate are also rising somewhat, supported by the higher skimmed milk powder price. The DCA quote increases by €50 to €1.850. The increase was particularly apparent in the second half of this week. At the start of the week, the supply was significantly wider, due to factory failures.
Although the prices of the liquid dairy products are picking up with the heat, the undertone in the market has not immediately improved. All in all, it is difficult to say which direction the prices will take.