EU Wholesale Prices

Published 11 January 19

SMP and butter were the two main movers on EU wholesale markets this month, with butter continuing its downwards trend and SMP showing relatively strong growth. WMP, whey and average cheese prices were steadier, with only marginal movements. Festive demand helped support markets, although with the typical drop off over the holidays themselves.

In terms of milk supplies, 2018 EU production was running 1.1% ahead of 2017 for the January-October period. Germany is running ahead of this at +2.3%, while France, the Netherlands and the UK lagging behind the average. These trends are expected to continue through to the full-year figures. Looking into the new year, production growth could slow in those areas where feed quality and availability has been impacted by the weather conditions of 2018.

Butter prices fell by 4.2% on the month, but this decline is less than the previous two months. Lower prices have encouraged domestic sales and the festive season helped boost internal demand, particularly for packaged butter. This added some support to the market, though as suppliers were able to meet the increased demand the impact on price was limited. The EU price premium over Oceania continues to dampen export interest and add downwards pressure to the market.

Demand for SMP has been unusually strong for the time of year, helping to boost prices by 6.5%. Reports of uncertainty surrounding availability of fresh SMP supplies may have contributed to the strong demand. Additionally, sales of intervention stocks have been good, with nearly 75% sold by the end of December, which is easing its weight on the market. Meanwhile, WMP prices have been fairly steady, with buyers in no rush and cheaper prices elsewhere limiting exports.

Cheese prices fell at the start of December, but were relatively steady through the rest of the month. The exception was Emmental, which after dipping in the first weeks of December, jumped up in the middle of the month, leaving it up on November overall. There was strong internal demand for cheese, but with suppliers able to meet it through elevated production and drawing on stocks. Most trade was for deals already agreed, so buyers looking for near-term delivery struggled to source product. 

 EU Wholesale Table

Please see text above and notes below.

EU_wholesale _graph

Please note that prices can vary markedly within each market sector: the prices above are intended to give a guide to trends in price changes, but the absolute values experienced in the market place may differ from those shown.