Milk in key exporting regions
%-change versus previous year
Europe
The EU joins the ranks of key exporters with growing volumes of milk on their hands
Prices in the EU liquids market correct downward in line with developments in dairy commodity markets. At a time of the year that historically milk prices tend to go up, spot milk prices have by now fallen from EUR 0.50 to EUR 0.47 in just about a week. Dutch and German prices are at similar levels. Supply of spot milk is building as commodity prices are insufficient to provide a return. However, with cream prices declining from EUR 8.10 to EUR 7.20 within a week the spread to butter production is rapidly declining. Cream is even cheaper than butter currently, which is unusual in September.
Americas
California no longer slows US milk production down
With California definitely leaving the negative number behind - + 3.8% in July – the USA as a whole appears to be on course for several months with growth rates between 2.5 and 3.5%. Last year’s H2 comparable numbers were more or less zero so everything seems to be in place for strong and steady growth. With local demand developing mostly sluggishly, especially in foodservice, it is expected that a lot of US milk will continue to flow into the global export markets in the remainder of the year.
Asia-Pacific
Early comments indicate a strong start of the new NZ season
It is still too early for hard data on milk production in New Zealand at the start of the new season. However, anecdotal remarks from local processors indeed indicate a very positive start of the season with current milk volumes being 3% above last year on the Northern Island and even somewhat higher on the Southern Island. Sell side efforts from NZ manufacturers also indicate a lot of milk in the region as they are working hard to sell the peak season volumes ahead of growing competition from the EU.
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