There was a little bit more positivity in the dairy market this week with small rises for butter and cheese although skim milk powder (SMP) and whole milk powder (WMP) were flat.
European butter is now trading at around €3,875/t while cheddar cheese is available at €3,425/t.
At that price, butter is at its lowest level since 2021, so it’s safe to say its on the floor and the same can be said for cheese. It is only SMP that is doing relatively well and currently sits at a higher price than at any time since the peaks of 2022.
The other big news this week is from the Global Dairy Trade auction. The overall index increased by 0.6%, which is relatively flat.
The main movers were WMP which increased by 1.2% and butter which increased by 2.5%. SMP was almost flat at 0.2% of an increase while almost everything else declined in price.
Cheddar fell by 1.3% and anhydrous milk fat fell by 1.6%. The overall volume of product traded at the GDT auction was small at just under 13,000t which is the lowest volume to be traded since 2013, which is extraordinary.
Speaking on this week’s Inside Dairy podcast, Ciaran Aylward from Ornua said that the state of the market is relatively flat, with no big changes up or down.
He says the war in the Middle East has been a negative for dairy demand as gulf states are big purchasers of dairy, but that the closure of the Strait of Hormuz has closed off a route to the market for about half of the product.
He also said that the war has been generally bad for dairy demand, despite an uptick in prices when the war started first.
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