The milk market stabilized slightly in mid-May: Milk deliveries increased by 0.4% in the 20th calendar week, following a previous decline. This reduces the gap to the previous year to 1.3%, although milk volumes for the year to date are still 1.8% down on the previous year.
Demand on the butter market is currently brisk. The asparagus season, public holidays and retail promotions ensured good sales of packaged butter. National sales statistics also confirm a slight increase in sales. On the block butter market, demand is increasingly shifting to long-term delivery dates, which, in combination with declining milk deliveries, points to further firming prices. Prices are rising accordingly: The Süddeutsche Butter- und Käse-Börse in Kempten listed block butter at €7.30-7.60/kg in the 22nd calendar week, while molded butter was recently even listed in a range of €7.40-7.80/kg - an increase of up to 20 cents on the previous week. In food retail, a packet of German branded butter remains at €1.99, 14 cents more than in the previous year.
The market for semi-hard cheese remained balanced at the end of May. Demand remained at a good level, meaning that current production flowed directly into the sales channels and no significant stocks were built up. Food retailers supported sales with regular promotions, while the industry also ordered reliably. Only in the communal catering sector has there been a lack of strong demand recently - although this could soon change if the weather continues to warm up. The export market proved receptive overall, even though demand from southern Europe - particularly Italy - was somewhat weaker due to the weather. In third-country business, the USA's customs policy continued to cause uncertainty, while US suppliers competed with low-cost offers. On the positive side, sales opportunities to Asia increased. The price situation remained stable: the Hanover quotation commission set unchanged prices in the 22nd calendar week - bread products were valued at €4.80-5.00/kg, block products at €4.45-4.65/kg. In view of falling milk volumes and higher producer prices, producers are increasingly pointing to the need for higher sales prices in order to safeguard production economically.
After a brief revival in the middle of the month, the market for food-grade skimmed milk powder calmed down somewhat at the end of May. Nevertheless, there were still individual transactions - both for short-term cover and for later delivery dates. The weaker euro level in particular favored international trade, especially with third countries, and despite the slight reluctance of many buyers, especially in the forward segment, interest from Germany and abroad remained at a moderate level. The price trend remained stable to slightly rising in view of firmer prices for skimmed milk concentrate. On the European Energy Exchange (EEX) in Leipzig, skimmed milk powder was quoted at an average of € 2,533/t in May - an increase of € 11 on the previous week. Futures for the months July 2025 to January 2026 were even higher than the spot market level. In contrast, the market for skimmed milk powder in feed quality remained calm. Buyers are currently well supplied, which led to an overall stable to slightly firm price picture.
ZMP Live Expert Opinion
The milk market stabilized slightly in mid-May, in particular due to an increase in milk deliveries. Butter prices rose significantly, driven by high demand and limited supply. The market for semi-hard cheese was also stable with good domestic demand and slight export growth, despite uncertainties in the US business. The situation for skimmed milk powder remained balanced: While food quality benefited from stable international interest, the market for animal feed was quiet. Overall, there are signs of a firm to slightly rising price level in all areas.
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