UK Wholesale Prices

Published 27 June 18

Market views taken for trade occurring between 1 to 27 June. Prices reported are indicative of values achieved over the reporting period for spot trade (excludes contracted prices).

As ever, the following prices represent an indicative average of UK wholesale markets. The “average” prices should be used to track trends while the commentary will contain prices seen at the end of the month.

All prices quoted are in £/tonne.

All talk and no action seems to be the flavour of the month for wholesale prices. Trade was very thin for all commodities due to a mixture of tight supplies and a standoff between buyers and sellers. Market dynamics are unusual at the moment. Last month prices increased while milk production was hitting peak stride. However, this month production has eased off, dry weather poses concerns and stocks are still tight, yet prices, for most products, have eased as the month has progressed. This has also been seen in the spot milk market. Spot prices have risen from around the mid to low 20s to pushing 30ppl, if not over.

Butter eased through the month with buyers seemingly waiting for prices to come down. This sentiment appears to have come from not long being past flush production and futures providing an unclear picture of what might happen. However, lack of trade clouded the picture further, making it difficult to distinguish the difference between quoted and traded prices.

Cream prices were all over the place in June, as thin trade meant prices were varied depending on when deliveries needed to be made, and how much product was required. Prices started the month anywhere between £2,400 and £2,500 before falling towards £2,100 and £2,200. Some traders felt prices eased at the start before falling quickly in the last week or so. Others felt there was a constant step change through the month.

For SMP, the momentum died out slightly over the month despite a lack of available fresh product. Prices started well before easing as the month progressed. EU prices have become uncompetitive with US product so prices rebalanced somewhat following on from the partial revival last month.

Mild cheddar was the only product to maintain some level of firmness over the month. There was a difference in prices depending on quality but the market seemed fairly tight in June. Availability continued to be tight and the feeling seems to be that more longer-term deals could be the way forward as producers do not want to produce extra for the spot market in volatile times.

UK Wholesale Table
                          

UK Wholesale Graph

 

Notes: Prices have been compiled by talking to dairy product sellers, traders and buyers. Panel discussions on market conditions and prices covered trades agreed for the period 1 to 27 June. The published prices will not necessarily match the actual price received by a milk processor as this will depend, amongst other things, on the proportion of product that is sold on the spot market and the proportion sold under longer term contracts and at what price this is done.