FCMP
Price levels are closely aligned in the three regions but the underlying sentiments diverge
Europe
Sluggish market
The EU FCMP market is looking for direction in the current economic turmoil. At the price level of EUR 3350-3400 ex works valorization is high enough to process FCMP even without a sales contract. The demand side is taking it easy, with most buyers in no hurry to secure volumes against the outlook of the flush season and the looming threat of an economic recession.
Americas
Balanced market
The FCMP market in Latin America feels quite balanced. Regional milk production is about 10% higher than it was this time last year, but demand is healthy as well, with Brazil buying decent volumes. The price has dropped a little, in order to remain competitive versus Oceania, to the current USD 3800-3850 FOB. At this level Latin America powder should also be able to service ONIL if and when they put out a tender. The Latin American buyside has increased the forward coverage and confirmations are now being negotiated for June delivery.
Asia-Pacific
Hesitant market
The supply of FCMP in Oceania is shrinking, even though it remains difficult to assess the actual availability in Oceania. There is demand for product, but at the levels that the sell side is prepared to do business at – USD 3750 FOB – most buyers are hesitant. Were ONIL to submit a tender this would probably absorb the final bits of product left in Oceania.
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