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Dairy markets continue to firm against a backdrop of strong buyer demand and tight supplies. The spring has finally arrived in Europe and milk production is rising towards the annual peak, but markets are holding steady as buyer demand remains strong, particularly for dairy fat products.
Spot prices for butter have traded as high as €5,700/t in the last week. At this level, buyers are extremely anxious that prices could spiral out of control again, similar to last September, when butter prices reached a record of €7,000/t.
On the cheese side, dairy traders in Europe report very strong demand over the last week, with cheddar and mozzarella prices rising. There has also been some positive developments on the powders side of the market.
Skimmed milk powder (SMP) prices have risen steadily over the last month and are now trading as high as €1,500/t. This is the highest level for SMP prices since October last year. Spot prices for whole milk powder (WMP) have also risen somewhat over the last month and are now trading in the region of €2,650/t.
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