With most dairy traders across Europe still off enjoying their summer break, there is very little price activity on European dairy markets this week.

Spot prices for butter reported to the Dutch dairy board remains stable for the fifth week in a row at €3,330/t.

It’s a similar story for whole milk powder (WMP) prices, which have not changed in five weeks from €2,720/t.

In contrast, the spot price for skimmed milk powder (SMP) has come under a small bit of downward pressure in the last two weeks, with prices this week dropping slightly to €2,050/t.

Subdued outlook

On the supply side of the market, the outlook remains subdued in Europe. The big three milk producers in Europe – Germany, France and the UK – have all reported weaker milk flows in recent months due to the warmer weather on the continent and a weaker demand outlook.

Outside of the big three, dairy farmers in Ireland and Poland continue to produce extra milk

For the first half of 2020, German milk production is slightly ahead of last year at just under 16bn litres, while French milk supplies are around the 12.4bn litres mark. In the UK, milk production in the first half of the year is down almost 1%, or 44m litres, at 7.7bn litres.

Outside of the big three, dairy farmers in Ireland and Poland continue to produce extra milk. Irish milk production is up 3.4% in the first half of 2020 at 4.3bn litres, while Polish milk production is 3% ahead of last year at 6.1bn litres.

Meanwhile, Dutch milk collections are up 2% in the first half of 2020 to 6.9bn litres.