Analysis dairy market
Pressure on liquid dairy in particular is increasing again
The dairy market felt a little strange this week. Most cheese and milk powder prices were (and are) under pressure, but because the pressure there was less than in the liquid segment, there was still reasonable product in milk powder and cheese. The feeling is that the losses can be better absorbed in this way than with simple liquid storage.
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Apparently parties still see opportunities for export and alternative sales, but the market is not very transparent at the moment. Prices of certain products currently appear to be much looser than normal, as a number of traders note.
Raw milk market weakest
Meanwhile, the spot market for raw milk is not doing well. This is where the most pressure is on prices. The Dutch and North German spot quotations are declining and are almost as low as at the beginning of this year.
In the meantime, cheaper products from France, for example, are also entering the market. Milk is offered there for just over 25 cents per kilo. As mentioned, processors are doing their best to keep milk away from this spot market, but that is not always easy with an ever-increasing milk supply. It's a bit of mopping with the tap open. Skimmed milk and concentrate are also quite low priced, but not everything is bad.
It can also be seen that the prices of certain powders are approaching each other again.
Food and feed closer together
For skimmed milk powder, the price difference between food-quality standardized milk powder and feed-quality unstandardized milk powder has decreased considerably. The intrinsic value of the latter product is more apparent at lower price levels.
The same can be seen with whey powder.
The price of the latter product remains relatively low and its production not very remunerative. Whey and also thickened whey are still collected for free or almost free, because otherwise it would not be worth drying it. This is mainly due to the high drying costs.