Milk in key exporting regions
%-change versus previous year
Europe
Spot milk prices are declining a bit, but less than normal in Q2
Milk production volumes are going up seasonally but Western EU has turned a bit dry in the last 6-8 weeks. Rain would certainly help to get the grass really going but already spot market prices are moving downward in most key markets. In France prices have declined the most to a level of EUR 0.36-0.40 ex works. Pressure is also building a bit in Germany where spot prices are at EUR 0.46-0.47. Prices in Belgium and the Netherlands are stable at EUR 0.52-0.53. Q2 prices traditionally weaken even a little more but a lot of milk still finds a home at these prices. Cream prices have been very firm for a long time but buyers are looking forward to the weeks after Easter when cream often finds a bottom. Eastern EU cream is most competitive at the moment.
Americas
Tariff disputes create uncertainty about the US dairy export potential
The US season is slowly but surely gaining momentum as the Bird Flu impact on California’s output is gradually being phased out of the herd. The interesting situation is now being created that milk prices are affected negatively by the uncertainty about US dairy commodities being able to find their way to export markets. If doors are going to be closed due to retaliation measures in certain key markets the US milk surplus will continue to weigh heavily on the local market balance and may put even more pressure on market revenues going forward.
Asia-Pacific
Current dry weather in NZ could impact the start of the new season
The Oceania season is winding down but the current weather conditions are crucial for the quality of winter feed and subsequently the condition of the herd at the start of next season. Circumstances are a bit challenging on the Northern Island but things do not look too dramatic. The remainder of the season will most likely be neutral to slightly negative due to Australia being behind on last year’s numbers. Buyers are obviously looking at the Northern hemisphere during the upcoming months.
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