Cheese
Minor price movements
Europe
Price stability, but will it last?
Downward price pressure is building in the EU cheese markets, but the price levels for the various cheeses generally still held their ground. Mozzarella prices were most volatile, which is a direct result of the shorter shelf life than the harder cheeses and the relative overvaluation when looking at the content level. The current market price for Mozzarella in the EU is about EUR 3400 ex works. There is export demand, but with the forex fluctuations and rising freight rates US product is often very competitive. However, EU Mozzarella has quite a loyal customer base in Asia. Gouda prices are now around EUR 3500 ex works. The average age on delivery has increased a little as the supply situation is loosening somewhat. Once the retail negotiations will be concluded demand will probably step up. Cheddar sales from the EU have benefitted from security stock building in the Middle East through ports in Western Saudi Arabia. Irish production is up and running and there is sufficient demand to absorb the seasonally growing supply. The price across the EU is about EUR 3400 ex works. Overall, the EU cheese market feels relatively balanced at the moment.
Americas
Exports continue to flourish
The US cheese prices have been a little volatile in the past month. Despite strong cheese production the market feels a bit tighter, driven by normal to flat local demand in combination with good export demand for Mozzarella and white cheddar. February export volumes were record high even. In the domestic market the availability of under 30 day old colored cheddar has tightened these past few weeks. Colored cheddar blocks are now changing hands at prices of USD 1.50-1.60/lb (3300-3500/t) and white blocks generate closer to USD 1.70/lb (3750/t), both ex works. Overall, the US cheese market feels pretty balanced at the moment, but beyond Q2 it remains to be seen if domestic and export demand will continue to be able to absorb the peak supply and keep the prices where they are.
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