EU wholesale markets continue to be supported by production, which is at seasonal lows and also running behind expectations. Demand remains firm, with demand for some products increasing ahead of the holiday season. Reports indicate prices for cream and skim milk concentrate have all risen over the last few weeks, which influenced the availability and prices of other commodities. Consequently, prices for the products rose across the board, although to different degrees. Butter rose 10%, while SMP and WMP rose by around 7%. Whey prices rose 5% and finally the average cheese price rose by a relatively steady 2%.
Butter prices rose consistently week on week from the end of Oct through November. Although prices movements were more mixed within the month of November itself, they still averaged at over the €5,000/t mark overall, for the first time since September 2018. Rising cream prices off the back of seasonal demand helped to support the butter price in November. Demand pressures eased somewhat in the latter part of the month.
Higher prices and low availability for skim milk concentrate supported skimmed milk powder (SMP) prices in November. This helped keep supplies tight, with manufacturers having supplies to fill existing contracts, but little more. Spot buyers were reportedly having to cobble together deals with multiple sources to meet their needs.
Whole milk powder (WMP) prices also rose on the back of tight supply. Low milk production means producers are reluctant to produce WMP outside of existing commitments. Production is reportedly focused on internal markets, instead of exports.