Market prices for skimmed milk powder (SMP) have continued to firm following the European Commission’s successful clearance of the remainder of its intervention SMP stockpile. Spot market prices for fresh SMP product have this week rallied to highs above €2,000/t for the first time since June 2017.

It’s less than six months ago that market prices for SMP were on the floor below €1,400/t as the European Commission’s intervention stocks overhung the market. The bounce in SMP prices over recent weeks is due to the final clear-out of these intervention stocks.

At last week’s tender sale, the European Commission sold a further 18,500t of SMP out of intervention for a minimum selling price of €1,585/t. Less than 4,000t of SMP remain in intervention now, which is irrelevant in terms of its impact on market sentiment.

With intervention stocks now cleared, expectations are that SMP prices could firm further in the coming weeks, with export demand from Europe reported to be very good. Markets such as Algeria, China, Egypt and Malaysia are the main export destinations for European SMP.

Whole milk powder (WMP) prices also lifted this week close to €2,900/t.

Of the other dairy commodities, European cheese markets have been very steady in recent weeks. Cheddar prices are solid at €3,000/t, while the price of mozzarella is also at €3,000/t. On butter markets, prices held steady this week between €4,300/t and €4,400/t. German supermarkets are meeting this week to set the retail butter price in Germany for February.