Some analysts suggest there were indicators published in recent days to suggest weather and EU profitability factors may curtail global supply more rapidly than expected.

Latest statistics show reduced milk supply for France and Germany compared with last year and both are two big EU players.

EU weekly skim milk powder (SMP) prices are €186/100kg, which is 35% down on prices for the same period last year. Prices for SMP were closer to €280/100kg in 2014 for the same period.

Weekly EU prices for butter are not down as much and at the moment are €303/100kg. For the same time last year, the price would have been closer to €350/100kg.

Whole milk prices are down 24% compared with the same period last year and are now running at around 2012 prices at €254/100kg.

As reported previously, the big drivers are reduced Chinese demand. January to March imports to China are well back, with skim back almost 40% and butter and whole milk powder down 50%. The other main driver is US milk supply, which is up 1.7% over the same period last year.

There doesn’t seem to be joy coming from New Zealand either this week.

The world’s largest dairy exporter is expected to provide its first forecast for the upcoming 2015/16 season this week, with one of the leading New Zealand banks forecasting an opening milk price of between $5/kg of milk solids and $5.25/kg MS, which it says will leave many dairy farm budgets in the red. Dutch spot milk prices lifted up to 22c/litre from 18c/litre in the latest information.