European dairy market: SMP stronger, butter and cream weaker, WPC80 continues to fall [Issue 322 of the Foodcom DAIRY Newsletter]

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Mid-October brings an increasingly clear contrast between the milk protein market and the milk fat market. SMP prices have moved higher as buyers secure their remaining Q4 needs amid limited availability. Butter and cream, on the other hand, are cheaper. WMP remains relatively stable, as strong SMP prices partially offset weaker milk fat prices.

The whey and protein market remains mixed. WPC80 continues to fall in price, though the pace of the correction may be starting to slow, and WPI is declining more gradually. MPC85 availability remains limited, SWP is holding steady, and cheese prices are generally stable.

Milk Powder

Whole milk powder (WMP) is being offered in Europe in the range of 3,900–3,950 EUR/MT. Limited supply and low inventories are keeping prices near current levels. Strong SMP is supporting WMP, while weaker milk fat is limiting the scope for further increases. Therefore, generally stable prices through Q4 remain the more likely scenario.

Skim milk powder (SMP) for food use is priced at 3,500–3,600 EUR/MT in Europe, while feed-grade SMP is priced at 3,450–3,550 EUR/MT. Broader price indications for Q4 fall within the range of 3,450–3,550 EUR/MT. Strong demand for unhedged Q4 positions is met with limited availability, which keeps prices firm.

Cheddar

Gouda is being offered in Europe in the range of 3,500–3,550 EUR/MT, and indications for Q4 are around 3,450–3,550 EUR/MT. Trading is stable, and for now there is no clear impetus for significant price movement in either direction.

Edam is priced at 3,450–3,500 EUR/MT.

Cheddar cheese is being offered in Europe in the range of 3,750–3,800 EUR/MT, while indications for Q4 are around 3,700–3,800 EUR/MT. Spot prices remain firm, with offers at 3,750 EUR/MT and above.

Mozzarella is priced at 3,400–3,450 EUR/MT in Europe, while Q4 indications range from 3,450 to 3,500 EUR/MT. Some spot quotes have shifted toward the upper end of the current range, though the main price level in Europe remains lower. The market is therefore mixed and does not yet show a clear sign of strengthening.

Emmental intended for grating is being offered in the range of 3,650–3,700 EUR/MT. The main price level in Europe remains essentially stable, although lower spot prices are also available.

Fats

Butter in Europe is being offered in the range of 3,750–3,850 EUR/MT, while Q4 indications stand at around 3,700–3,750 EUR/MT. High inventories and weak Q4 buying are weighing on prices, and many buyers have already secured their needs. If additional demand does not return, prices may weaken further.

Liquids

Cream in Western Europe is being offered in the range of 4,500–4,600 EUR/MT. Prices are trending lower, and some offers are already appearing below the main trading range.

Spot raw milk in Western Europe is trading at around 42–44 EUR/100 kg. Prices remain relatively stable and are centered around 43 EUR/100 kg.

Skim milk concentrate (SMC) is being offered in Western Europe in the range of 3,200–3,300 EUR/MT. Prices are firmer, although regional levels continue to vary considerably.

Whey concentrate is priced at 1,500–1,600 EUR/MT. Prices remain firm and essentially unchanged.

Whey and Proteins

Sweet whey powder (SWP) for food-grade use is offered in Europe in the range of 1,950–2,050 EUR/MT, while feed-grade material costs 1,750–1,800 EUR/MT. Some food-grade specifications remain difficult to source, and part of the demand for Q4 remains unhedged. This keeps prices at a strong level.

WPC80 Instant is being offered in Europe in the range of 20,500–21,000 EUR/MT. In Eastern Europe, prices are lower, at around 19,250–19,750 EUR/MT. WPC80 continues to decline in price as sellers try to place remaining volumes for Q4, while buyers are postponing purchases. The price differential relative to MPC85 has narrowed, which may limit the scale of the next major correction.

WPI Instant is priced at 28,400–28,800 EUR/MT in Europe. Prices are falling more slowly than for WPC80. Spot availability remains relatively limited, and the variety of specifications means the market is not moving uniformly. Therefore, the correction should remain gradual.

MPC85 is being offered in Europe at around 16,000 EUR/MT. Availability remains limited; most Q4 needs have already been secured, and little product remains for late buyers. Demand for milk proteins remains strong, though trading activity remains limited.

Whey permeate for food use is priced at 1,050–1,100 EUR/MT in Europe. Demand remains good, but additional supply linked to higher WPC production is making the market slightly weaker.

Food-grade lactose is being offered in Europe in the range of 1,650–1,700 EUR/MT. A large portion of Q4 demand has already been secured, so additional buying interest is limited. Increased supply is hindering price growth, although there are no signs of a significant surplus. The market should remain generally stable, albeit with slight downward pressure.