Horeca sector started its activities and the demand for sliced cheese rose. However, taking into consideration the decline in the raw material collection, it might be hard for producers to obtain any yield. Country allotments for cheese have been maxed out for Italy, Sweden, the UK, and Ireland amongst others. Germany has only used 3% and Poland used none. The producers offer higher prices, but the demand does not match it.
Butter prices are stronger. The demand for butter cubes and butter blocks is rising. Spot activity can be noticed and contracting for Q3 is taking place but at a much slower pace. Not many contracts were concluded in the end. Germany, Netherlands, and Ireland are the countries that have most butter in PSA. Stocks of butter are tight in Australia and New Zealand.
Even though this time of the year in Europe is known for a seasonal decline in milk production, German and France report higher production than this time last year. Poland also noted the increased numbers versus last year. On the other hand, Australia noted a decrease of 0.6% in raw milk production.
SMP holds tight in Western Europe. The production is stable and contracts are concluded both within EU as well as in export destinations. The price is expected to rise, so both parties are eager to finish the deals. As the situation with the pandemic is still unknown, spot contracts are safer solution. Almost half of PSA for SMP comes from Germany. The lactose price went up. The availability is scarce and most producers are already sold out. Production seems to be bigger than at the same time last year, but manufacturers appear to be keeping up with the pace. WPC remains constant. Not only milk powders but also whey powders increased. Sellers keep the price high but still manage to conclude agreements. The rising trend is expected to continue as the demand from Asia grows, but there is still some uncertainty with the second wave of COVID-19.