Buoyed by healthy demand in global export markets, European dairy prices are now firmly on an upward curve in the early weeks of 2021. European spot market prices for butter shot up €80/t this week to hit €3,350/t, which is the highest price level for European butter since before the COVID-19 pandemic hit in March last year.

European prices for skimmed milk powder (SMP) have increased in tandem with butter prices this week.

According to the Dutch dairy board, spot prices for SMP increased above €2,300/t this week. Again, this is the highest price level for European SMP since before the COVID-19 virus hit Europe last year.

On cheese markets, European prices for cheddar remain steady at just under €3,200/t, while mozzarella prices increased marginally to just over the €2,650/t mark.

The steady uplift in European dairy markets follows a similar trend in New Zealand, where the benchmark GDT index increased again this week for the fifth time in a row.

At this week’s GDT auction, average dairy prices increased almost 5% thanks to very healthy demand for milk powders, butter and other dairy fats.

The price of whole milk powder (WMP), which accounts for over 50% of all product traded on the GDT platform, increased more than 2% this week to $3,380/t (€2,795/t). Even more impressively, SMP prices shot up a whopping 7% this week to just under $3,245/t (€2,680/t).

On the fats side, butter prices increased 5% to $4,735/t (€3,910/t), while the price of anhydrous milk fat shot up by 17% to just under $5,400/t (€4,460/t).