Analysis dairy business
Dutch spot milk by level of payout prices
The dairy market is moving again, with the most striking development being a skyrocketing cream price. This also moves smoothly away from the butter quotation, which it has been relatively close to in recent weeks. Raw spot milk will also become clearly more expensive and will reach the level of the payout prices.
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Cream's jump appears to be partly a correction to the sharp decline that hit the powder market last week, and partly a result of the end of the holiday period.
Although not much has happened with skimmed milk concentrate in terms of price, sellers still indicate that there is more demand, especially from Southern Europe.
There has been a certain milk shortage there due to the dry, hot summer. It is not yet possible to say how much this will be, but there is considerable demand for German and Dutch milk, especially from France. This means that the spot milk price will gradually return to the level of the dairy payment prices.
The sharp increase in the price of cream has actually created a division in the butter market. The price of fresh butter must increase with the price of cream, otherwise there would be no fresh butter. The price of frozen butter, meanwhile, remains stable and low, at a price level of about €300 or more below the price of the fresh product.