Prices for butter on European spot markets jumped 4% this week above €5,400/t, as the prolonged heatwave continues across most of Europe.

While much-needed rain has arrived in Ireland and helped reinvigorate grass growth, dairy farmers in continental Europe are still coping with temperatures reaching into the high 30s.

The hot weather is likely to hit both milk volumes and quality in some big dairy-producing regions of Europe and markets have pushed dairy commodity prices higher this week as a result. Even the price of skimmed milk powder (SMP) jumped to its highest point in over a month at just under €1,500/t on spot markets.

While July and August milk production is expected to take a hit in many European member states, June milk collections held up better than expected, despite the hot weather.

Figures released by Eurostat show that milk production in Ireland, the UK and Poland increased for the month of June, while the only major dairy-producing country to record a decline in production for June was the Netherlands.

In Ireland, June milk production was up 1% to 920m litres, while, across the Irish Sea, UK dairy farmers produced almost 1.3bn litres for June – a 1.5% increase on last year. Milk production in Poland grew by 1% for the month of June to just under 1bn litres.

Dutch milk production for June was down 1.5% at just over 1.1bn litres, which is the fifth consecutive month of decline for Dutch milk output.