Dairy market surprisingly firm

Dairy market surprisingly firm
Agrarmarkt Informations-Gesellschaft (AMI), Mittwoch, 03.02.2021 - 12:50

(AMI) – Keeping an eye on the markets is one of AMI's core tasks. From now on, you can benefit from our detailed analyses and forecasts on milk and dairy products in English.

The markets for dairy products were very stable at the turn of the year. Due to public holidays and vacations, business was initially quieter at the beginning of 2021, but this had hardly any dampening effect on prices. Consumer demand was stabilized by the lockdown, so the dip in January was less pronounced than usual. As a result of the subdued milk supply, product markets were mostly characterized by limited availabilities. The recovery in demand over the course of the month led to significantly firmer prices for milk powder and whey powder. Bulk butter also showed a recovery. The cheese market tended to be stable, after uncertainties due to the Brexit and the lockdown had previously led to weaker deals in some cases.

Milk market defies the Corona pandemic

In the coming months, the deliveries of raw milk are expected to continue on a reduced level. The number of dairy cows has declined in the course of structural change and producer prices are currently not motivating production expansion. In addition, there are no large stocks available. Considering the rising markets, the demand side will attempt to cover existing requirements before prices rise further. In this context, buyers on the domestic market will have to compete in part with the large demanders on the world market, where EU goods are increasingly on a par with competitors due to the the price increases. In addition, private consumption, which is already higher as a result of the lockdown, may be stimulated by the easing of restrictions.

This is likely to lead to a stable to firmer price situation in Germany in the coming months, particularly on the protein side for skim milk and whey powder, where goods have recently been increasingly sought after. On the fat side, too, sufficient sales could stabilize prices. In the case of bulk butter and cheese, on the other hand, there is significantly less potential for price increases at the beginning of the year.

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Herr Andreas Gorn - AMI Experte für Milch und Milchprodukte

Andreas Gorn

Marktanalyst Milch und Milchprodukte

Tel.: (0228) 33805-100
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