Liquid dairy pushes market towards cheap Christmas

In fact, prices across the entire liquid segment fell sharply, as spot milk prices also fell, and the price for skim milk also plummeted. Only whey concentrate saw a slight increase.

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Butter from Poland
Butter prices, which have caused quite a stir in recent weeks, are somewhat quieter this week, but this doesn't mean the butter market has calmed down. Lots of butter are still being offered well below the quoted price. This week, it seems to be mainly Polish butter.

The powder market remains broadly unchanged from last week. The price of skimmed milk powder is under slight pressure, while the price of whole milk powder is under more pressure. Whole milk powder is currently one of the weaker products on the market. The whey powder market, on the other hand, is calmer and more positive, more in line with what's happening with whey concentrate.

Cheese market with two faces
The cheese market isn't immune to the problems affecting the rest of the dairy market, but anyone who wants to quickly pick up a load of cheese before Christmas will have to pay a premium. There's not much available locally. That will change in the new year. Prices will be under more serious pressure before that time. The positive performance of the last few weeks has disappeared, as a further weakening market is expected after Christmas.

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Raw material value milk
Not that any profit is being made yet. According to DCA Market Intelligence's valorization tool, the raw material value for basic dairy is below €40 per 100 kilos. That's still well below the milk price dairy farmers receive in the Netherlands.   

The sharply declining prices for cream and concentrates have had some notable consequences. The fall in the price of cream has resulted in it now being almost as high as the price of butter. This hasn't been the case in a long time. This also makes it more attractive to make butter from the large quantities of spot cream currently available, but the question is whether this will actually happen.

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The sharp drop in concentrate prices is forcing buyers of this product to work even harder, primarily to produce skimmed milk powder. Those who buy concentrate for €1.200 or €1.300 per ton and powder it can make a substantial profit, particularly through exports – at the expense of traditional powder producers. However, concentrate buyers are increasingly having to search further afield in Europe for independent powder processing plants. 

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