Market analysis - European dairy market
1) Price level & market signals (EU)
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EU average prices remain below the previous year overall, e.g. butter around € 419/100 kg and SMP around € 210/100 kg according to Milk Market Observatory data.
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At the same time, the latest weekly reports show a short-term recovery: butter and SMP prices in Europe have recently risen by several hundred euros per tonne.
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The overall picture is one of a low structural level and a simultaneous short-term price increase.
2) Raw milk prices & revenue situation
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The farm-gate prices have fallen significantly since fall 2025 and in February were mostly only around 42 - 45.5 ct/kg.
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At the same time, EU milk deliveries in 2025 remained above the previous year (+1.6 %), which explains the price pressure.
3) Global context & demand
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There is still a global milk surplus at the start of 2026, which is depressing prices for milk, butter and cheese.
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Nevertheless, trade and auctions have recently shown mixed to positive signals, such as rising GDT prices and short-term market rallies.
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Overall, the global market is sending mixed signals between oversupply and demand impulses.
ZMP Live Expert Opinion
In mid-February 2026, the European dairy market is in a transitional phase between structural price pressure and the first signs of stabilization. Following the significant price declines since fall 2025, individual market segments - particularly butter and skimmed milk powder - are showing short-term signs of recovery. However, these are not yet strong enough to speak of a sustainable trend reversal.
Short-term development (February 2026)
A cautious calming of the market can be seen on a weekly basis.
Several factors are currently having a stabilizing effect:
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Slight price rally for butter and SMP at European level indicates that demand is picking up again.
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Improved results from international auctions (GDT) are supporting global price sentiment and reducing downward pressure in the short term.
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Powder markets are showing relative robustness, which suggests that demand for milk proteins remains sustainable.
At the same time, the market environment remains fragile:
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Price levels remain well below the previous year, particularly in the fat segment.
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Producer prices have weakened noticeably since fall 2025 and are now only in the low to mid 40 ct/kg range.
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High milk deliveries in the EU continue to put pressure on supply and limit short-term price increases.
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