175th Edition of Foodcom DAIRY Newsletter
Overall, the last few (dozen?) days have been pretty quiet in the dairy market. Who would have expected, given all the holidays and vacations… In any case, at the moment it is difficult to make clear predictions about the future situation on the market because every player has a different opinion about the direction in which it will develop.
Large quantities of milk are being produced in all major regions. These are larger volumes than in previous years, which is particularly evident in the EU. However, this is not a big surprise considering the current time of year (you did remember to change the calendar to May when you returned from vacation, right?). Characteristic of the current market is low demand for the coming weeks, while interest in third and fourth quarter supplies is growing. This is precisely the problem (at least for those who want to buy) because few sellers want to sign up for such a distant future.
We have been away for a while (did you miss us?), but some of the topics we discussed last time are still relevant. Another major factor in shaping the current market situation continues to be the full warehouses, but that’s not surprising since many were busy with their vacations and the goods did not have a chance to be liquidated. What else was going on in the market? Read on!
Continue reading to learn about this week’s market insights.
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Despite the increase in quotations for raw material (Cream) before the May long weekend, the market was able to record a correction in which raw material was available and enjoyed high availability. As for the production of high-fat products such as clarified butter, it is cheaper compared to Butter production. On the world market, Butter has increased, which is also reflected in the quotations on the futures market, where we saw higher prices for the second half of the year. A noteworthy fact: a twofold increase on GDT.
Skimmed Milk Powder
With the recent tenders on the global platform and the second week in a row with an increase in pulse overall, we see the tendency that the product is less available at discounted prices and is offered higher, considering the external European demand. On the private market in Algeria, product traded at €2450-€2500/ MT CFR, Algiers and Onil tender ended last week at $2900 – $3000 CFR, while EEX July traded at €2580/ MT. The question remains whether this is the peak of recent growth, as the volume traded in recent weeks can certainly affect market capacity.
As the interest in cheese, especially Dutch-type and Mozzarella, has not diminished for several weeks, producers are keeping the price high and stable, while complaining about a lack of spare capacity. Are they really unable to produce more Cheese, or is this just a game with the public to build an even higher price? Only they themselves know. Nevertheless, we still receive many requests for these products, and customers are willing to pay more than in previous weeks if delivery is made in the same week.
The same is true for whole milk as for skim milk, which we have seen recently. The product has been traded on the world market at higher prices in auctions and tenders and is therefore in great demand on our continent. The availability of this product is limited, and we have received many inquiries about this product last week.
In recent days, the situation for Cream remained stable throughout Europe. Skimmed Milk Concentrate was also stable. In general, we observed a high availability of liquid dairy products on the market.