Summer weakness still far away on the liquid dairy market

The movements in the raw milk market involve small differences. There is more movement visible in semi-finished products. Cream is trading slightly higher at DCA this week than last week, the price for skimmed milk concentrate is slightly weaker.

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The latter is caused by the fact that concentrate is too expensive to powder and is therefore dependent on the fresh market for price formation. An important part of the product goes to destinations such as Greece, which, according to sources, is also having some difficulty with the current price level.

The cream price is also largely determined by demand from the fresh market, but other factors are active there. The butter price itself may be on the low side to meet the current spot price for cream, but the fact that the butter market - despite calm trading - remains firm provides support for the cream price. Demand from the fresh market does the rest.

Meanwhile, the big surprise comes from the liquid whey market. There, the price of thick whey/whey concentrate has risen in a short time from about €200 per tonne to €450 per tonne. There appear to be two causes for this: lower cheese production in the Netherlands and Germany and a strong demand for whey proteins from the high-quality ingredients sector. High prices are made for WPC-80 and higher and for WPIs. They are in great demand for sports and specialty nutrition and the good sales make us want to have more. 

This development also improves the value of cheese and whey compared to the cream/butter and milk powder option and other choices.

The spot milk price has picked up well in recent weeks and is now approximately circling around the level of FrieslandCampina's guaranteed price.

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The price of raw materials is also increasing, but according to the latest (German) calculations, it is still lagging behind somewhat.