Room price is damaged due to German holidays

The price of cream has been overvalued compared to butter for a long time. With the current butter price at €3.500 per tonne, cream is worth around €4.250 'on paper'. However, thanks to good demand from the fresh segment, more was paid for weeks.

Less demand for cream
In Germany, and even more European countries, religious holidays are celebrated next Thursday, October 31 (Reformation Day) and Friday, November 1 (All Saints' Day). Then the activities are put on the back burner. Also in dairy. 

With a broken week ahead, demand for cream is weakening somewhat. As a result, the DCA cream price drops €150 to €4.350 per tonne. Towards the end of the week the price fell even further. The prices of spot milk in Germany are also declining somewhat as a result.

It is expected that the cream price may recover when demand returns. One condition is that the long-term price agreements with German retail have a positive outcome. Those conversations are currently underway. A farmer advocate in Germany is demanding that milk processors take a firm stance during contract negotiations. This could increase the milk price. A higher milk price still appears to be expected for November too early despite the rising cheese and powder prices in recent weeks.  

Flattening powder price
The expectation is that the butter price will end the year at a stable level. Supplies are probably too ample for a traditional Christmas revival. Exports outside Europe are doing better and that is averting price pressure. Looking at the milk protein, we see a stabilizing skimmed milk powder price. This means that the DCA quotation for skimmed milk concentrate this week remains at €2.180 per tonne.  

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