Slight price pressure in dairy due to questions about supply

At first glance, this tension seems barely noticeable in the market, but it is at the back of our minds. Many dairy prices may now fall for a while, but it is often said that a bottom is not far away, with reference to the stock situation. What is now in the warehouses can be picked up if there is a little demand.

Cream biggest loser
The situation this week is now one of slight price pressure. Milk fat is the exception. The cream price had to drop about 4% in the DCA quotation this week. Not shockingly much in itself, but more than the other products. The price of butter also fell, but became slower. Market parties see a clearly greater supply of cream. The butter supply is not immediately much larger, although part of the cream is also converted into butter. This product is on average priced lower than winter butter specifically, which has extra value, especially for the bakery sector.

Skimmed milk concentrate is also sufficiently available, but demand has also grown. The quotation of concentrate is much less under pressure. 

The cheapest supply of skimmed milk concentrate traditionally comes from (Western) France at this time of the year. Product is for sale there from €2.005 to €2.010 per tonne. Well below the listing here. The additional and cheaper supply is offset by an increasing demand from Italy.

Divided image of the spot market
The picture of the spot milk market is divided. The price in the Netherlands is stable compared to last week, the North German price has fallen slightly. All this with a slightly larger selection.

In France the price is also slightly lower, but that is because the fat and protein contents are also lower. Yet there is no really cheap milk available here either.

Prices for milk powders continue to decline for the umpteenth week in a row. This means that the price for skimmed milk powder is getting closer to that of concentrate, although the price also fell this week. Fortunately for European suppliers, export demand remains, and - fortunately in the current circumstances - also largely on this side of the Red Sea.

The Asian market is of greater importance for whey powders, especially for the 'higher' whey powders. However, for now this does not seem to have a negative effect on the quotation for food whey powder. This may be partly because there are still good sales for this product in Europe.

The cheese market was fairly stable for a long time, but that has changed since last week. Prices are under pressure, although things are not booming yet. It also does not apply to all cheeses. The quotations for Emmentaler, Maasdammer and natural cheese, among others, remain stable. The pain for producers and traders is with foil cheeses, mozzarella and Cheddar.

There is extra pressure on prices for Cheddar, because cheap American and New Zealand supplies are coming onto the market, reportedly for €3.800 and €3.900 per tonne (from). This cheese cannot be used by every processor and therefore cannot go directly to retailers. It may be an alternative for certain manufacturers of compound foods. The quantities are not yet large, but this supply still has an effect on the market. It is a setback for Irish cheese makers, among others, who wanted to start the season with prices of €4.250 to €4.300 per tonne.