Analysis Milk
Dairy basics reverse the downward trend in the dairy market
After several weeks of weaker prices, the dairy market is feeling stronger again this week. Not only the liquid semi-finished products, but also the primal commodities - skimmed milk powder and butter - are increasing in price, just like Gouda cheese.
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Price increases or decreases often occur per product group. Now that is not the case. Skimmed milk powder, for example, is the only major type of powder that is increasing in price. Whole milk powder still feels slightly weaker, while the price for fat-filled product is also weak. The whey powder price also continues to decline. The uncertainty that pushed the market down last week is now pulling the market for various commodities up again. The big question remains: what needs can be expected in the third and fourth quarters?
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The butter price continued to rise this week, but not at the same pace as the cream price. Cream was the biggest increase in this short week, with a plus of €215 per tonne.
The price for skimmed milk concentrate also rose well, to an average of almost €3.000 per tonne of dry matter. This means that the margin for processing into skimmed milk powder is slightly smaller, but it is still reasonably good. Especially now that prices are rising again.
The picture is mixed on the cheese market. Last week there was a little extra supply of 'yellow cheese' (Gouda/Edam in foil) for short-term delivery and at slightly lower prices. This week, these types of bargains appeared to have disappeared again and prices for Gouda cheese in particular recovered. Edam remained priced slightly lower, as did mozzarella. At Cheddar, the curd rose slightly in price and the mild was slightly lower in price.
Whey powder prices are under further pressure. The price gap between whey powder food and whey powder feed is slowly closing, but it is still intact. However, the feed price still feels quite high at just under €1.300 per tonne for the calf milk industry, for example.
The fact that whey powder prices are still at the current level is not due to a shortage of raw materials, according to the market. There has been an oversupply of whey concentrate for some time, but it is not dried because most powder towers are in use for the processing of higher-yielding products such as skimmed milk powder.
In the meantime, the market continues to feel nervous. There is therefore little certainty that the directions we are currently taking will remain the same for a long time.