The latest quotes from the EU milk market observatory show US butter up 17% on early August quotes and well ahead ($2,000 to $2,500/t) of EU or Oceania butter quotes. US Cheddar prices are also higher ($3,803/t).

The powder products – skim milk powder (SMP) and whole milk powder (WMP) – are similar to European quotes.

New Zealand total annual milk supply was up 2.8% to 21.9 billion tonnes to the end of May 2015 and the most recent figures published for June (the very start of a new year for New Zealand) suggest milk supply is up 8.1% for June 2015, rising to 147,000t from 136,000t.

It’s really not until August that milk starts to flow in New Zealand and the 8% mentioned, while a relatively high percentage, is really just high because of the very small volumes produced.

All the indications and advice to New Zealand dairy farmers from Fonterra is to reduce supply given the low farmgate price.

US milk supply continued to rise compared with 2014 figures, according to the latest June figures published.

In June, US milk production was 7,913,000t, up 0.7% on June the previous year, which cumulatively brings the year to 1.6% ahead of 2014.

The US has produced slightly less butter year-to-date, but is rapidly making up ground on 2014 now. It has produced 27% less skim compared with 2014 year-to-date.

Australia is making a lot more cheese and a lot less WMP.

EU

On the EU front, in summary, milk collection increased by 3.9% in June 2015. For the first half of the year, 0.8% more was produced, – ie +624,000t. This compares with +747,000t milk in the US (+1.6%), +78,000t in NZ (+0.9%) and +102,700t in Australia (+2.5%).