Milk News, 20.03.2025

The trend of rising milk deliveries in Germany continued towards the middle of March. The higher temperatures at the beginning of the month led to a further increase. According to the ZMB), around 0.6% more milk was delivered in the 10th calendar week than in the previous week. However, the seasonal growth slowed somewhat. Compared to the previous year, the volume of milk delivered remained below the level - in the 10th week, the drop was 1.4%, while the decline for the first ten weeks of the year amounted to 2.1%. The raw milk market developed unevenly in mid-March. The Kiel commodity price fell by 1.4 cents to 46.9 cents per kilogram. While spot prices in the Netherlands remained stable, northern Italy recorded slight price increases.

Demand on the German cheese market remained high in the second half of March. Food retailers and the industry ordered continuously, while the export business remained at the usual seasonal level. Manufacturers reported that production stocks were largely sold out and stocks in ripening cellars remained tight. Prices remained stable or rose slightly. Due to the high demand and limited supply of raw materials, market participants are expecting further price increases, boosted by the Easter business.

The market for food-grade skimmed milk powder calmed down in the second half of March after a brief upturn. Trade with third countries was dampened by Ramadan and the rise in the euro exchange rate. At the beginning of the reporting week, the latter reached its highest level since October 2024, making European goods more expensive on the global market. Market participants are counting on new impetus from the possible lifting of the import ban in China and Malaysia. Falling prices for skimmed milk concentrate recently led to weaker prices for dried goods.

The market for block butter continued to see high trading activity in the second half of March. The stable trend on the fat market led to sustained demand, while supply remained limited due to milk deliveries being below the previous year's level. In addition, only small stocks were available. Sales of block products reached an above-average level for the time of year, with demand remaining particularly high for short-term deliveries in March and April. As a result, manufacturers were able to achieve higher prices in some new business. The Süddeutsche Butter- und Käse-Börse in Kempten recorded a price of EUR 7.45 to 7.60/kg on March 19, 2025, which corresponds to an increase of 10 cents at the lower end and 5 cents at the upper end compared to the previous week. This further narrowed the price gap to packaged butter. On the European Energy Exchange (EEX) in Leipzig, the price forecasts for block butter remained stable. The average price for the period from March to November 2025 rose by EUR 56 to EUR 7,424/t compared to the previous week. While the expected prices for delivery dates in March and September were within the range of the spot market, they were lower for the months of April to August and October to November. Trading activity on the EEX increased again in mid-March. In the 11th calendar week, 2,870 tons (574 contracts) were traded, which corresponds to an increase of 165 tons (33 contracts) compared to the previous week. In the second half of March, demand for packaged butter and spreads remained at a high level. Manufacturers reported stable sales of both products in the food retail sector. Developments in the market for industrial cream and higher regional temperatures were cited as possible influencing factors. At the same time, limited availability continues to be reported. In view of the upcoming Easter holidays, demand is expected to remain high. Dairy prices for molded goods remained unchanged in the second half of March due to ongoing contracts. Negotiations for the new contract period from April will begin shortly. In view of the existing demand for butter and the increased prices for the raw material cream, a possible price change is expected. On March 19, 2025, the Süddeutsche Butter- und Käse-Börse in Kempten quoted an unchanged price range of EUR 7.40 to EUR 7.80/kg for packaged butter. In food retail, German branded butter in the entry-level price segment continued to cost EUR 1.99 per 250-gram packet.