Cheese
Mozzarella provides superior valorization
Europe
The Mozzarella market feels more balanced than the Cheddar and Gouda markets
In recent months production of both Emmental and Cheddar benefitted from the abundant availability of spot milk at very low prices. Manufacturers with excess capacity grabbed the opportunity but as a result prices suffered. Cheddar trades at EUR 3300 ex works in all production regions. The question is what will happen to prices now that spot milk prices are gradually moving closer to farmer milk prices throughout the EU. Gouda prices are also at EUR 3300 ex works and supply is also quite strong. The average age is increasing but has not reached critical levels yet. The Mozzarella market feels more balanced as sales both domestically and in export markets are strong. Mozzarella production is equally strong since manufacturers prioritize Mozzarella production at the moment to prevent additional pressure in the other cheeses. Mozzarella prices remain elevated in relative terms. Most volumes are traded around the EUR 3400 ex works level.
Americas
The weight of supply nudges prices down
At this time of the year domestic demand for cheese in the US is often a little slow. Food service demand particularly is soft and though retail demand is good to fine it is not great. Export demand, though, is solid and particularly mozzarella is very competitive on the world market. US supply is strong with good production of cheddar, mozzarella and hard Italian cheeses. Colored cheddar prices came down to the USD mid 1.40s/lb (3200/t) range and white exportable cheddar changes hands in the USD 1.50s-1.60s (3400-3650/t) range, both ex works. Particularly when priced at the bottom end of this range, US export cheddar has a competitive advantage to EU cheddar. Mozzarella producers are quite comfortable as their product easily finds it way to international buyers. Domestic cheese demand usually picks up in the next month or two but until that happens most buyers are likely to stay off the spot market and rely on their annual contracted quantities.
More insights
If you're interested in Cheese, you may also like these topics:
