The outlook for dairy markets in 2019 received a major boost last week after more than 60,500t of skimmed milk powder (SMP) were sold out of EU intervention.

Just as encouraging was the increase in the minimum selling price for this product, which rose by almost €150/t to reach €1,451/t.

The jump in price for intervention stocks has in turn pushed up dairy market prices for freshly produced SMP to their highest point in two years at €1,750/t.

This latest tender sale means the European Commission has now sold close to 277,000t of its intervention stocks of SMP in 2018, which leaves just a little over 100,000t of SMP remaining in intervention storage across Europe.

Expectations are growing that these stocks could be cleared by the end of February 2019 as buyers seek to lay their hands on the last of the cheap SMP in comparison to fresh product.

A full clearout of the EU’s intervention SMP stocks could breathe new life into milk powder markets next year.