In Germany, the seasonal decline in milk deliveries is continuing. In week 29, the volume was again -1.2% below the previous week and just below the previous year's figure. Due to the spread of bluetongue, considerably less milk is being delivered to German dairies from the Netherlands. Milk ingredients also remain below average this year. Based on several years of experience, further declines in deliveries are to be expected in the coming weeks and months.
While current butter production is increasing significantly due to the high price incentives, SMP production is falling significantly. The supply of cheese is also lower than in the previous year.
Milk payout prices vary depending on the focus of milk utilization and whether the milk is produced in the north or south. On average, however, an upward trend is discernible.
The Kiel exchange milk values calculated from butter and SMP exchange prices signal prices up to just above the 50 ct/kg mark in Q4 2024, with butter prices providing the dominant support.
Selected prices/rates for dairy products in Germany (sources: Kempten/Hanover, EEX, Ife, GDT)
Butter: The tight supply situation continues to drive up butter prices. Packet butter is particularly in demand, but block butter is also showing upward trends. The falling milk supply with low fat content is exacerbating the shortage situation. Butter prices worldwide are at multi-year highs.
Cheese: Cheese prices continue to rise. Domestic and foreign demand is greater than the limited supply available. The comparatively long production/maturing period is slowing down a rapid supply response.
Milk powder: The abundant availability of milk powder worldwide as a result of China's reluctance to buy is also putting pressure on prices in this country, as high surpluses mean that the goods are not flowing out in sufficient quantities.
The most recent GDT auction delivered prices that were on average +0.5% higher than the previous auction. Whole milk powder and butterfat prices provided the main underpinning. The well above-average turnover of around 35,500 tons (previous auction around 24,000 tons) is striking, only slightly below the high of 40,000 tons
ZMP Live Expert Opinion
The low milk production at the previous year's level is exacerbated by the seasonal decline in deliveries. This trend is also expected to continue in the coming weeks and months. Supplies of butter and cheese are particularly tight, while milk powder remains in surplus. Market prices are signaling further increases in milk prices.
You see historical data because you're not logged in or not a ZMP Live+ member. Get your information advantage now!
