Weakness and uncertainty mark the dairy market

The fact is that this week all the positives have suddenly disappeared from the dairy market. In fact, most dairy commodities record a minus. Only whey powder and Cheddar remained more or less the same in price.

Remarkably, while prices for skimmed milk powder in Europe continue to fall, the GDT auction recorded a plus this week. However, analysts see this more as a logical correction compared to Europe, because lean powder in Oceania was undervalued, than as a real price increase.

The price of whole milk powder also fell, and slightly more than that of skimmed milk. This is mainly due to the sharp drop in the price of milk fat.

This drop in the price of cream was most visible. According to DCA's quotation, it fell this week by €850 per tonne, or 11,6%, to €6.470.

Butter was much slower, but its price still lost more than 3%. With the rapid fall in the price of cream, the normal price balance between cream and butter has almost been restored. In Germany, the demand for fresh butter is gradually picking up again, parties there report. Dairies can almost start producing fresh butter again.

As in previous months, cheaper lots of butter continue to be offered, below the quotation, but they are usually of a different quality.

The price for skimmed milk concentrate also fell almost as sharply as the price of cream. The demand for this decreased considerably, due to a declining demand for fresh products and probably also for cheese, as a result of which there is sufficient supply.

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The spot price for raw milk and skimmed milk also fell extra sharply. The Dutch spot market seems to be an exception to this, but this is a very specific small pond. For Dutch fresh production, specific Dutch milk is often requested, which also meets additional conditions. 

For the first time in a long time, the cheese market has seen a slight price drop for Gouda and Edam foil cheeses. Perhaps not earth-shattering with the end of the year in sight, but still striking. At the same time, the price for natural cheese is rising sharply and is overtaking foil cheese.

In recent times, many manufacturers have made less natural cheese and more foil cheese. This will allow the price of natural cheese to naturally adjust over time. The major producers have adjusted their pricing to the new situation.

Mozzarella, like foil cheese, had to give up a little position. Cheddar and Emmentaler meanwhile remain fairly stable in price.