Powdered milk, cheese, butter—major price adjustments in Europe [Issue 280 of the DAIRY Bulletin]

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Prices for dairy products in Europe are falling—powders, cheeses, and butter are seeing further declines, while cream and whey are undergoing sharp corrections. In this issue, you’ll find the latest price levels and key market signals, as well as an overview of global news—from the feed crisis in the UK, through the labor dispute in Australia, to trade negotiations between India and New Zealand.

Scroll down to view detailed market data and forecasts.

Milk Powder

Skim milk powder (SMP) markets across Europe continue to weaken, with food and feed prices approaching a narrow range of 2,200–2,300 EUR/MT. The latest downward adjustment reflects both limited export demand and the impact of ample milk supplies in key production regions. Activity in the spot market remains low, as most buyers have secured supplies for the coming months and prefer to delay additional commitments while awaiting further easing of the market situation.

Prices for full-cream milk powder (FCMP) are also under pressure, with offers falling to the 3,850–4,000 EUR/MT range. A decline in fat content has weakened demand for this product category, and competition from Oceania is intensifying, especially following the failure of the GDT auction. European producers, grappling with high processing costs, are finding it increasingly difficult to maintain forward price levels, leading to more aggressive offers on the spot market.

Cheeses

The European cheese market remains under significant downward pressure. Prices for Gouda andEdam cheeses have fallen again and currently stand mainly at 3,650–3,750 EUR/MT on the spot market. Inventories are building up at several facilities, and demand remains limited, which restricts sellers’ flexibility.

Cheddar prices continue to fall and are around 4,100–4,200 EUR/MT. Recent price cuts are pushing many producers close to the break-even point, especially as exports remain low. The price of mozzarella has fallen even further, reaching 3,550–3,650 EUR/MT, where occasional purchases are visible but lack depth.

The price of Emmental cheese remains relatively stable at 4,450–4,550 EUR/MT, although indirect pressure from the broader market is becoming increasingly noticeable. The overall mood in the cheese segment is gloomy, and European producers must also contend with additional competition from Oceania and the United States, which is negatively impacting export opportunities.

Fats

The European butter market remains under significant pressure. Butter prices have fallen to the 6,200–6,400 EUR/MT range, reflecting weaker demand and the impact of ample cream supplies. Although some retail contracts still feature higher prices, sellers are finding it increasingly difficult to maintain premiums, especially as more and more products are being redirected toward butter production.

The AMF segment remains relatively stable, with trading taking place within a narrow price range and balanced interest from both industrial and export buyers. However, the overall situation in the fats market suggests that further corrections are possible if milk supply remains seasonally high and demand does not increase.

Liquids

The European liquid market has undergone a significant correction. Cream prices have plummeted to the 7,200–7,400 EUR/MT range, representing a substantial decline from recent peaks. This decline reflects both weaker demand and a shift in processing, where some sellers are redirecting volumes back to butter production.

The price of skim milk concentrate (SMC) stands at 2,000–2,050 EUR/MT, with the German product setting the benchmark. Additional volumes flowing into the EU from the UK are increasing supply, maintaining market balance but limiting any upward movement.

The availability of raw milk remains high for this time of year, which puts additional pressure on processors who are already struggling with lower prices for finished products.

Whey Powder

The European whey market is showing limited volatility. The price of food-grade sweet whey powder (SWP) remains stable at 1,000–1,050 EUR/MT, while the price of feed-grade SWP is slightly lower at 920–940 EUR/MT. Activity on the spot market is low, and export demand is weak—particularly from Asia—which means that the domestic market is unable to absorb the available volumes.

The price of whey concentrate is 750–850 EUR/MT (on a dry matter basis). Supply is steady, but processors continue to redirect whey streams toward higher-value proteins.

WPC 35 is priced at 2,600–2,700 EUR/MT, reflecting stable demand from feed and food manufacturers.  WPC 80 remains stable at 11,600–12,000 EUR/MT, supported by steady orders from the sports nutrition sector.

WPIprices have fallen slightly but are stabilizing in the range of 19,300–19,600 EUR/MT. Although supply is sufficient, higher processing costs continue to pose a challenge to margins.

The price of lactoseis around 1,200 EUR/MT. Demand from feed and pharmaceutical buyers is present but cautious, limiting the potential for a recovery.

Overall, the whey market remains balanced but lacks momentum, and there are few signs of significant changes in the short term.

What’s new?

United Kingdom

The dairy industry faces growing challenges as the feed contamination crisis raises concerns about animal health, milk safety, and long-term supply stability. Experts warn that contaminated feed, which may contain harmful substances, could threaten herd health and reduce milk quality, raising concerns among both farmers and consumers. Industry leaders are calling for swift action to identify the sources of contamination, strengthen regulatory oversight, and support farmers in mitigating the effects of the crisis, emphasizing that without coordinated intervention, the crisis could escalate into a serious threat to the economy and public health.

Australia

In Australia, a heated debate is underway regarding the pay terms for Fonterra Oceania employees in connection with the upcoming $4 billion acquisition. The United Workers Union claims that employees, who have long contributed to the company’s success, are receiving worse terms than their colleagues elsewhere, while Fonterra maintains that its latest offer—a 10 percent wage increase over three years, extended vacation time, and improved benefits—is fair. Striking workers say the proposal is insufficient, and as Lactalis prepares to acquire Fonterra Oceania’s operations, pressure is mounting on both sides to reach an agreement that will safeguard workers’ rights while ensuring production stability.

New Zealand

Negotiations are underway for a potentially landmark dairy agreement as India and New Zealand enter the third round of talks on a free trade agreement (September 1–7, 2025), in which Wellington is seeking to open up the vast Indian market—the world’s largest consumer and producer of dairy products—while New Delhi remains cautious, protecting its industry with tariffs of 30–60% and favoring imports of only select value-added products, such as whey powder or mozzarella, in an effort to balance modernization with the protection of 70 million small-scale dairy farmers as part of the “Atmanirbhar Bharat” strategy.