165th Edition of Foodcom DAIRY Newsletter

Author
Foodcom Experts
15.02.2023
6 min reading
165th Edition of Foodcom DAIRY Newsletter

Well, a lot has happened in the dairy market since we last saw each other. Prices have started to rise, significantly for some commodities, which many have been waiting for. The situation is dynamic. This is often said about the commodity market, but this time this statement is really not exaggerated. Some prices, for example, Butter, change from hour to hour. Sometimes even more frequently. Everything indicates that the market will remain uncertain in the coming days, and the tension will be easily felt.

Skimmed Milk Powder

With another week of skimmed milk price increases, we have witnessed a slow but steady rise in prices across the European Union. Cheaper purchasing options are not to be found, especially since the prices of feed grade product have also increased. After the increased demand last week, manufacturers raised prices, which did not stop buyers from continuing to commit to purchase. We have also received notice from previously silent buyers whether the offers provided in January are still available. The GDT results undoubtedly contributed to the rise in dairy prices in Europe last week.

Butter

Butter hasn’t seen the red light throughout the last week. Each day we witnessed an increase in price of 200 EUR/MT, depending on the country of origin. This was mainly due to high demand from the retail sector which consumed a lot of the product, so other buyers jumped into the pack as well. Currently, Butter manufacturers have stopped quoting the product as the market is too volatile to make further offers.

Full Cream Milk Powder

Following the trend of Skimmed Milk Powder and its prices, Full Cream Milk Powder has also experienced a short rise, which additionally attracts some demand on the export side.

Gouda/Edam

In addition to Butter and all dairy commodities, the market has suddenly seen a shortage of the previous offers that started at 2 at the front and therefore revived the product Gouda/Edam above the 3 mark. In addition, Mozzarella is also above 3 again. Demand for cheese has increased as well, putting pressure on buyers to buy now or wait for another increase next week. 

Cream

For the third week in a row, the prices of Cream have also increased. Last week, not only the price of Cream rose, but also the price of all liquid dairy commodities.

 

What else?

Europe

In 2022, Bulgaria experienced a significant increase in procurement prices for raw milk

Due to rising world market prices and increased costs of animal husbandry (that’s the old, bad news), raw milk procurement prices in Bulgaria increased by about 33%. Nevertheless, they remained among the lowest prices in Europe. Only in France, Slovakia and the Baltic States they were even lower.

A case of unusual mad cow disease has been detected in Spain

A dead cow in the northwestern region of Galicia was found to have atypical bovine spongiform encephalopathy (BSE). It was announced that this particular case does not pose a public health risk. Such atypical cases of mad cow disease occur sporadically and spontaneously in older cows. The second variant, the typical sort of infection, is usually caused by contaminated animal feed.

smaXtec, a software developer based in Austria, has created an application to increase herd fertility

The technology developed by the company makes it possible to take precise measurements of the body parameters of a particular cow. On this basis, it is possible to detect estrus and determine the optimal time for insemination. As a result, breeders can monitor herd health, increase herd fertility and optimize production. Is there anything that cannot be improved with a smartphone app? 

The Americas

USDA forecasts a decline in milk production in the United States

The department predicts that both lower milk production per cow and a smaller herd will result in a decline in U.S. milk production in 2023. That’s pretty simple math… In the latest report, USDA also lowered cheese prices due to large inventories and soft domestic demand. In addition, nonfat dry milk and whey prices were lowered due to increased export competition and lower global demand.

All eyes are on Canada and its strategy to solve the milk dumping problem

Recently, a Canadian dairy farmer posted a touching video online that was viewed by 3 million people. Canadians were shocked to see a farmer dumping milk while food prices skyrocketed. The Canadian dairy industry is regulated by the government with a quota system that appears to be too low for the herd’s production capacity. Many Canadians, especially farmers, apparently believe there is a need to cry over this particular spilled milk. There is currently a heated discussion on the Internet and elsewhere about how the widespread milk dumping in Canada should be resolved. 

USDA has announced another round of aid to dairy farmers

The Department recently announced details of the second round of payments under the Pandemic Market Volatility Assistance Program (PMVAP) and the new Organic Dairy Marketing Assistance Program (ODMAP). The upcoming activities and programs are designed to assist small and mid-sized dairy farmers who survived the pandemic but now face other challenges. The next round of PMVAP assistance is expected to be nearly $100 million. A nice financial boost, no doubt!

Asia & Oceania

New Zealand saw a decline in milk production in 2022

The latest figures indicate that production fell by about 3.8% compared to 2021. Experts point primarily to the reduced number of dairy cows as the main reason, as well as too much moisture on an annual basis. Farmers add that the strict production and environmental regulations were also not insignificant…

Iran will export dairy products to Japan

Japan recently added Iran to its list of authorized dairy suppliers. This could be significant for the Iranian economy, especially for the dairy industry. The Iranian Ministry of Agriculture has announced that companies that undertake to export dairy products to Japan can count on its support.

India: the capital of dairy

India remains one of the world’s largest milk producers in the 2021-2022 season. In the last eight years, milk production in India has increased by as much as 51%. Such a result is impressive, no question about it. This success is primarily due to the hard work of farmers and producers, as well as the government programs that support them. Perhaps India is the famous land of milk and honey?

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