Dairy markets continued to strengthen this week.

Cheddar cheese jumped over €200/t on European markets to exceed €3,000/t, while this week’s GDT auction result was up 0.1% with whole milk powder bouncing 2.1% to $2,761/t.

Arrabawn chief executive Conor Ryan said there had been a definite improvement in dairy markets over the last two weeks of May.

Speaking to the Irish Farmers Journal agribusiness editor Lorcan Allen this week, Ryan said he was a lot more optimistic on the health of dairy markets this week than he was a fortnight ago.

“The last few weeks have definitely helped dairy markets,” said Ryan. “The drought and its impact on milk production in places like Germany, France and the Netherlands hasn’t done any harm to market sentiment.

“We’re certainly not going to see the worst-case scenarios for milk prices that looked likely at the start of the COVID-19 lockdown,” he added.

The Arrabawn boss said the worst of the milk price cuts are now over and the market is returning around 27-28c/l.

Ryan said that during the COVID-19 lockdown, demand from supermarkets for liquid milk, cream and packet butter rocketed due to panic buying and a rise in home baking. In the early weeks of the lockdown, Arrabawn’s sales of liquid milk spiked 50% to 60% .

While things have since normalised somewhat, liquid milk sales are still 5% higher on last year.

Despite employing over 400 people, Ryan said Arrabawn has not had any incidences of COVID-19 infections at any of its sites and its plants have remained fully operational throughout the peak weeks of supply.

Right now, Arrabawn’s weekly milk supply is running 8% ahead of the same time last year. In the year to date, milk supply is up about 3%.

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