UK Wholesale Prices

Published 27 April 18

Market views taken for trade occurring between 1 to 27 April. 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.

UK wholesale markets saw positivity in April as sentiment over milk supplies encouraged strong demand for dairy products. While milk production in the UK started the month in-line with last year, forecasts seem to be about 3-5% down, for most, and product stocks are pretty much non-existent. Short-term buying is still the method used at present, largely because sellers cannot and do not want to commit to long-term deals in a favourable market position.

Butter prices rose quickly through April. Earlier in the year, there was an expectation of more milk. However, this did not really come into fruition (partly due to weather conditions) and it seems there have been deals struck where product is still needed to fulfil orders, causing more people to venture into the spot market. Prices started around £4,200/4,300. It was less clear at the end of the month with some of the panel believing price had gone above £5,000 and others staying below.

Cream was more volatile, but still with an overall upward trend. Prices picked up quickly at the start of the month before easing mid-April and rallying again in the latter stages. Starting prices given by the panel were mixed (anywhere between £1,850 and £2,000) but general consensus was an end price around £2,200 (+/- a bit). As prices picked up quickly, the average seemed to edge towards the higher end.

Positivity of prices was not limited to fat, with SMP experiencing some fairly unusual upward movement, albeit marginal. Exchange rates played a part of this, as did lack of fresh availability. The sale of significant (compared to other tenders) intervention stock also provided more positivity around the market, although the fresh market impact was slim.

The previously reported two-tiered mild cheddar market saw the gap close somewhat in April. The lower quality side of the market saw a bit of a revival, a likely reaction to weather impacting expected milk flow. This also impacted on other cheeses. The higher quality product held fairly firm, increasing marginally.

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 April. 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.