Sentiment is on a definite upward curve in global dairy markets, as countries begin to reopen following the COVID-19 lockdown for most of April. Almost all dairy commodities are showing signs of price recovery after the sharp declines recorded in April. Since early May, spot prices for butter, cheese and even milk powders have been rising week on week, albeit from a low base.

In Europe, butter prices moved above €2,800/t this week for the first time since March, while cheddar prices also lifted to €2,900/t. Even mozzarella prices are starting to recover having been hit hardest of all cheeses in April.

Milk powder prices have also improved. Spot prices for skimmed milk powder (SMP) increased to €2,000/t this week to put further distance between the market and intervention levels. While European dairy prices are lifting, it’s important to note that prices for most commodities are still 15% to 20% down on where they were in mid-March.

After falling sharply since late January, SMP prices rebounded strongly at Tuesday’s event by shooting up 7% to hit $2,550/t

Meanwhile, average dairy prices lifted 1% at this week’s GDT auction in New Zealand thanks to a sharp rise in the price of SMP. After falling sharply since late January, SMP prices rebounded strongly at Tuesday’s event by shooting up 7% to hit $2,550/t (€2,330/t), which is over €300t ahead of European SMP prices. In contrast, prices for whole milk powder (WMP) dropped slightly (-0.5%) to just under $2,680/t (€2,450/t). Butter prices dropped 2% to just over $3,800/t (€3,480/t), while NZ cheddar fell by 6% to hit $3,865/t (€3,535/t).