Liquid dairy prices rally across the EU

With milk volumes across the EU declining, indicating that the peak of the milk season has passed, prices for liquid dairy commodities, such as Cream and SMC (skimmed milk concentrate) rallied during week 20. Weak milk intakes have been reported in key milk-producing regions across Germany, France, Netherlands and Ireland. With milk availability decreasing, processors returned to the spot market to source additional volumes, in addition to SMC and cream to fulfil production needs. Demand was further supported by recent mild temperatures across the EU with Ice cream manufacturers supporting the bullish sentiment. Market sources indicated that they would continue to monitor the markets for cream and SMC closely in the coming days, as these are typical indicators for price developments for butter and SMP (skimmed milk powder). With stocks for both butter and SMP tight across the EU, the price increase seen for liquid SMC and Cream is expected to add further upward price potential to the butter and SMP market, according to market sources.

Multiple market sources indicated that the milk production peak came earlier than expected and that they had got caught off-guard with lower-than-planned stocks for H2 2024. Market sources indicated that the mild temperatures during March and April might have supported an earlier-than-expected production peak.

For reference, the MBP for European Cream EXW 100% [Mintec Code: ED25] increased by €350/mt on the week to €7.200/m, while the MBP for Skimmed Milk Concentrate FCA Europe [Mintec Code: J117] was assessed at €1,975/mt on 9th November, up €275/mt on the week.

Mintec will continue to monitor the market situation closely during the coming weeks and will follow up with any news regarding the dairy market. If there are any questions or comments, please feel free to contact me directly.

Sandro Schulz Mintec EMEA Protein Team Lead

+49 15510 096845 [email protected]