Market comments Spring 2014
Last couple of weeks the market is in a stabilization mode. Seasonally milk production is declining and more production capacity is available which makes it easier to place material and gives room for stabilization and/or slight recovery of prices. The cheese market has currently taken a turn for the better and has recovered from the price dip in April/May. Also the butter and SMP market is stable.
However market uncertainties are here to stay. Much will depend on the size of the milk output growth for the second half of the year and the existing export opportunities. In general the dairy market has evolved a more supply driven character. The continuing growth of milk output is increasingly crucial for the current price situation.
For the time being there are also doubts about the extent of demand from China. When Chinese buyers will stay back from the market for any longer, it is the question if the other dairy importing regions in the world are able to compensate the decrease of China. Potential buyers have still a wait and see approach.
Also internationally price pressures are not over yet. On the GlobalDairyTrade auctions prices continue to decline since February. Although the downward price trend seemed to be reversed in the second half of June, prices of most dairy commodities to the last auction of early July still collected a considerable loss.
For more information, see www.milkprices.nl :
