Dutch Dairy Board eyes milk price fall after record highs dampen demand
With no intervention buying until March, and the prices of many dairy commodities already at or under intervention support levels, the bottom of the market was not in sight.
Private Storage Aid for butter two months earlier than usual was the only positive.
Price recovery would have to come from improvement in internal and international demand; instead, slowly deteriorating economic conditions were softening demand for consumption goods.
Last year’s record high prices had dampened consumer demand, while encouraging milk production increases.
Reporting October prices paid by 15 big EU milk buyers, the Dutch Dairy Board said introduction of seasonality payments had lifted the Glanbia price to €36.09 per 100kg, compared to the average of €34.61, while Kerry was at €31.83.
In their supplier newsletter, Dairygold Co-op said prices for many dairy products were at 15-year lows.
EU milk output was similar to 2007, but dairy production was increasing from New Zealand, Australia, and the US.
New Zealand was having a major effect on markets, because its currency was weak relative to the euro, and its milk season has started strongly.
