Cheese
Mozzarella continues to do well
Europe
Cheese markets in the EU are largely trading sideways
The EU cheese market in general has been quite busy these past few weeks. In cheese the firm protein market and weak fat market meet and cancel their trends out. There are small nuance differences between the various cheeses though, but overall demand remains relatively robust for spot deals. Forward buying for Q1 has started and it revealed that some buyers were actually a little shorter covered than they made appear. And surprisingly, despite the significant price difference with US cheese, exports do continue to happen as some cheddar buyers prefer EU origins. Cheddar prices for nearby deals are around EUR 3800 ex works, and some pressure may actually be building as end of season milk collection in Ireland is above expectations. Gouda prices are around EUR 3500 ex works and supply for spot deals is actually quite small, as also indicated by the young age of delivered product. Further forward availability is better. Mozzarella spot supply and demand appear well balanced, with most factories still running close to full capacity. At the price of EUR 3450 ex works valorization is good. As we exit the mozzarella season now Q1 is a question mark though.
Americas
Prices remain depressed
The cheddar prices in the US came down these past weeks, when good production levels were met by at best tepid demand domestically. Whereas in this time of the year US demand usually makes a holiday surge there has been muted activity on extra orders so far. As a result we saw colored cheddar blocks falling back to levels of USD 1.33-1.37/lb (2930-3020/t) and white cheddar to USD 1.38-1.45/lb (3040-3200/t), both ex works. For Q4 the US is the most competitive origin in the export markets and although import demand has been quite active it has not been able to change the price trajectory. For H1 the competitiveness on the world market is right on par with Oceanian supply so the outlook is a little murky. The mozzarella market on the other hand is tight and demand remains good, both domestically and in export destinations.
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