Milk in key
exporting regions
“Other EU” is the change in the aggregated milk production volume of all other EU member states except for the ones displayed individually in this graph. The individual countries displayed usually have finalised figures for the most recent months, but the other EU category inevitably has a higher degree of estimation.
Strong milk supply keeps pressure on spot markets
Europe
Summer weather takes the downward pressure off of the EU dairy market
The European heatwaves put the brakes on EU milk production and pulled spot milk prices towards processor price levels within just a couple of weeks. In some regions in Germany and Italy spot milk prices are currently even higher than factory prices as contracts need to be fulfilled. In Germany most spot milk trades at EUR 0.43 and in Italy even EUR 0.50. In the Netherlands spot milk trades at EUR 0.40 and French milk is just below that level. Protein remains more in demand than fat. SMC rapidly appreciated to EUR 3.20, which is quite a bit above SMP equivalent now. Cream prices are closer to economically viable commodity production but EUR 4.15-4.25 is also just a bit too high.
Americas
US milk production remains undented by geopolitical turmoil
US milk production is resilient despite the risk of possible increases in input costs down the road at the farm level. May milk production was 2.3% higher than last year. The recent Middle East events certainly have the risk of affecting the cost of energy and fertilizer, but things are as yet OK on the cost side of the farm P&L. The size of the herd is overall stable but content levels and cow productivity support availability of all components in the US market.
Asia-Pacific
Announced sales volumes indicate high expectations for the new NZ season
The announced volumes at GDT for upcoming sessions indicate that Oceania is preparing for a strong start of the 2026/27 season. Financial and physical circumstances seem to be favorable. However, after two strong seasons one almost assumes that it seems a bit of a stretch to expect three perfect seasons in a row, especially now that the chances of a severe El Nino event are apparently high. We will have to wait a few more weeks for reality to arrive.
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