European dairy market: prices for cream, cheese, WMP, and SMP are rising [Issue 315 of the Foodcom DAIRY Newsletter]

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In the 315th issue of the Foodcom DAIRY newsletter, we take a look at the situation on the European dairy market at the end of August. Reduced milk availability is having an increasingly noticeable impact on individual segments.

WMP, SMP, cream, and cheese have all become more expensive. The cheese market stands out in particular, where availability is limited but demand remains strong.

In the protein segment, the situation is more varied. Reformulation and the increased use of protein blends are reducing some of the demand for WPC80.

Milk Powder

Whole milk powder (WMP) is offered in the range of 3,600–3,700 EUR/MT. Skim milk powder (SMP) for food use is priced at 2,950–3,100 EUR/MT, while feed-grade SMP is priced at 2,900–3,000 EUR/MT for Q3 and Q4.

WMP prices have risen again. Lower milk procurement volumes and stronger market conditions in the dairy sector are supporting prices.

SMP has also strengthened. Reduced milk availability and higher prices for skim milk concentrate are driving up production costs while simultaneously limiting the amount of milk available for powder production.

Cheese

Gouda currently costs around 3,350 EUR/MT, while Edam is offered in the range of 3,100–3,200 EUR/MT. The availability of Gouda has decreased again. Lower milk collection volumes and lower milk solids content during the summer have limited production; therefore, the main reason for higher prices is currently limited availability rather than a sudden increase in demand.

Mozzarella is priced at 3,600–3,650 EUR/MT and is among the strongest segments of the cheese market. Warm weather continues to support demand, while available volumes remain limited. If supply does not improve, prices are likely to remain well supported through the end of Q3.

Cheddar cheese is being offered in the range of 3,500–3,550 EUR/MT. Global demand remains strong, but fierce international competition is limiting the potential for further price increases. Production in Europe is slowing due to a seasonal decline in milk availability and rising spot milk prices, making the regional market slightly stronger.

Emmental is priced at 3,700–3,750 EUR/MT. Prices vary significantly depending on specifications, and buyers pay a premium for specific specifications. Seasonal production is slowing, and the reduced availability of cheap spot milk is limiting the potential for increased production. As a result, there is also less Emmental available for grating.

In Q4, cheese prices will largely depend on milk procurement. Demand is strong for this time of year, but limited availability is currently having a greater impact on price levels.

Fats

Butter is being offered in the range of 3,950–4,100 EUR/MT. Prices are relatively stable but continue to see slight upward support. However, price fluctuations are significantly smaller than in the cream market.

High cream prices are supporting fresh butter, although available stocks continue to limit the potential for more significant increases. Price indications for Q4 are slightly higher, but the future direction will depend primarily on the availability of milk and cream.

Liquids

Cream prices have risen again and are currently quoted in the range of 5,150–5,250 EUR/MT. Lower milk procurement and increased competition for milk components are limiting availability, keeping cream one of the strongest segments of the European dairy market.

Spot prices for raw milk remain strong and have risen in several European markets. Depending on the region, prices range from approximately 41 to 45 EUR/100 kg. Declining milk procurement is increasing pressure on production profitability as Q4 approaches.

Skim milk concentrate (SMC) costs 2,850–2,950 EUR/MT. Availability has decreased, and some companies that typically sell this product are now seeking additional volumes themselves. Higher SMC prices continue to put pressure on SMP production costs.

Whey concentrate is being offered in the range of 1,350–1,500 EUR/MT. Prices are relatively stable but remain supported, as protein production influences the market’s use of liquid whey.

Whey and Proteins

Sweet whey powder (SWP) for food use in Q4 costs 1,900–2,000 EUR/MT. Feed-grade material is offered in the range of 1,550–1,650 EUR/MT for August and September, as well as for Q4. Strong whey concentrate prices and higher raw material costs are helping to sustain these levels.

WPC80 Instant is priced at 25,500–26,000 EUR/MT. Demand is becoming more balanced as buyers adjust their formulations and increasingly use blends of different proteins instead of relying solely on WPC. Global protein consumption remains at a healthy level, but buyers are actively seeking ways to reduce their demand for WPC.

Instant WPI is offered in the range of 31,500–32,000 EUR/MT. Availability remains relatively limited.

MPC85 is priced above 13,000 EUR/MT. Demand for milk proteins is strong, and manufacturers are using MPC and other milk proteins as alternative ingredients in protein blend-based formulations. This is driven by the significant price difference compared to WPC.

Food-grade whey permeate is priced at 1,000–1,050 EUR/MT. Supply is relatively high, but stable demand is absorbing the available volumes.

Food-grade lactose is offered in the range of 1,550–1,650 EUR/MT. Strong demand and lower inventories are keeping the market firm, and there is also potential for further price support.