Many minuses, but still confidence in the dairy market

Yet the market continues to radiate underlying confidence. A crash in dairy prices is certainly not imminent, almost all parties believe. The availability of milk is and remains too low for this and the demand for the product is too good. It is noticeable that many buyers have reasonably covered their needs for the coming months and that they now first want to see how the milk supply pattern will continue. Sometimes a large part of the initially anticipated purchase budget has already been used up due to the high prices. They prefer to postpone further commitments to purchases for the third quarter and beyond.

Good availability, no pressure
There is also quite a bit of product available at this time, although there is no real spring peak noticeable in milk supply. There is no milk pressure. If there are still some problems due to disruptions and the availability of cheap French and Polish products, the quotation for skimmed milk concentrate could simply drop significantly, also because milk powder producers are not eager to jump on board at the moment.

On balance, the room quotation fell slightly less sharply, but was on a rollercoaster last week due to all kinds of sentiments. At first it seemed as if €1000 had been deducted from the price, but after an initial significant dip, recovery occurred again. According to many, the fact that butter quotations have shown little decline in the meantime has contributed well to the recovery of the cream price.

The decline in milk powder prices was felt across the board, but producers and traders point to a wide spread in prices. This indicates quite a bit of uncertainty in the market, although differences in quality and destination of the product also play a major role. However, pressure on price formation due to inventory build-up is not noticeable. Large parties can also switch more easily and relieve the burden on the powder market by, for example, making more cheese.

Despite a slight decline in a number of quotations, converting milk into cheese is still the best choice. And the cheese market can still process production well, despite the average age of the product increasing slightly. 

Aldi around the bend
And retailers may have difficulty with the high prices, but more and more parties are realizing that there is no other choice for the time being. This week, Aldi Netherlands was one of the first to increase the cheese price by €1,50 per kilo.