Positive tone in dairy market unexpectedly maintained for a long time

Overall, with the current commodity prices, the dairy industry can gradually pay out more milk money again, although the scope for payment is not entirely evenly distributed.

The spot market for raw milk remains above the average payment prices of the factories, but is also remarkably stable given the availability of milk and the good cheese market.

The cheese market continues to surprise. This week higher prices were recorded again and not everyone had anticipated that. The price for Gouda and Edam foil cheese rose again considerably. Not to the level of last year, but to a peak this year.

And although the cheese factories produce considerable volumes of Gouda and Edam foil cheese in particular, the market is not yet oversupplied. Customers pay the requested price without much complaint and there is no inventory build-up.

The meadow, which also yields a lot more than until last late summer, is also selling reasonably well. A lot of this product goes into sports and health nutrition. Another part goes into fat-filled milk powder, while the calf milk industry also continues to buy some.

The butter market also continues to grow, although very little fresh product is still produced. The price of cream remains far too high to make fresh butter. This problem has only become worse in recent weeks, despite the rising price of butter. The price of cream has almost always gone up a little more. Even more so this week.

The market for (skimmed) milk powder is developing more slowly than that for cheese. Sales within the European Union are going relatively well, but exports remain necessary to keep the market healthy. It is precisely with exports that things are difficult. This is due to several factors. Exchange rates have not developed particularly favorably for Europe recently. This makes European products relatively expensive. In addition, lower prices were paid for lean powder at the latest GDT auction, although it was not so bad for powders from Europe.

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Finally, in the international milk powder market, in addition to the regular New Zealand, American and South American competition, there is also competition from extra cheap Russian and Belarusian powder. Although the exports of these countries are affected by Western sanctions policy, there are Russian products competing for a buyer in certain markets, such as Algeria, through the 'grey' circuit. That is easily €300 to €400 per ton cheaper than European product. This makes it quite attractive for a number of countries with less purchasing power in Africa and Asia.