Cheese
Supply tightness may be solved soon enough
Europe
Market remains quite tight
The cheese market is less globalized than the milk powder markets and for this reason the expected impact of the current geopolitical situation is slightly smaller and geared towards currency and energy prices. Nevertheless, the EU cheese prices have been moving at least 10% upwards in the major product categories. Only the cheddar price increase has been a little more modest, with Irish production about to start any moment now. The cheddar price is EUR 3500 ex works for curd and the EU is competitive for export business to Northern Africa and Asia. Mozzarella prices have risen fastest and they are now on par with Gouda, at EUR 3600-3650 ex works. Mozzarella buyers are gearing up for the ‘salad season’ that always brings higher consumption of this type of cheese. Gouda remains quite young on delivery which underlines the still tight supply situation. The Emmentaler market has shifted remarkably in the past month, when oversupply was countered by some producers that have the capacity to switch to alternative cheeses. This tightening in supply pushed the price from EUR 3200 in the first week of February to the current EUR 3550 level, ex works.
Americas
Temporary tightening supply pushes prices up
The US cheese supply has tightened a little these past few weeks, particularly for nearby delivery there are fewer blocks on offer. Domestic demand remains average and exports are good for all cheese types. Going forward shipping issues may become a burden though, and uncertainties on the export front are clearly rising. With the US milk production season on the corner the supply of cheese will grow further and the main question is if there is sufficient demand to sustain the prices. Colored block prices have risen to USD 1.58-1.63/lb (3500-3600/t) which is about 10% higher than we reported last month. White block prices are USD 1.68-1.73/lb (3700-3800/t), both ex works.
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