Inside Milk
Prices for solid dairy are picking up
The undertone in the dairy market has improved considerably in recent weeks. Production is moving towards the seasonal trough, which is reflected in liquid dairy prices. Recently, prices for solid dairy have also picked up somewhat.
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For example, the DCA cream price has been on the rise non-stop since the end of July and has since risen by €1.200 to €4.850 per tonne. Prices for skimmed milk concentrate and spot milk are also rising, although at a somewhat slower pace. Cream prices and skimmed milk concentrate prices have priced butter and powder producers out of the market, meaning a correction is looming.
Butter, milk powders and cheese
Quite unexpectedly, prices for solid dairy products have found their way up. Milk powder in particular is on the rise. The ZuivelNL quotation for skimmed milk powder has risen by €110 in recent weeks to €2.210 per tonne, which is the highest level in more than 2 years. The price of whole milk powder is also rising steadily.
Due to the high price of skimmed milk powder, cheese no longer provides the best valorisation of raw milk. This creates some mood on the cheese market, which means that the prices of Gouda, Edam and Frau Antje are on the rise. In the United States, the price of cheese is increasing even as fast as an arrow On. If the movement continues, it could also give European cheese prices some relief.
Brexit coming
The upward movements can be seen as an early recovery. The prospect of Brexit is likely to be a major blow to the European dairy trade. Nevertheless, the more positive sentiment is a boost for dairy farmers, although there is no prospect (yet) of higher payment prices.
This article is part of this week's published Trend report Milk & Feed Pro, which also focuses on the grain market, onion market and potato market. Click here to read the Trend Report.