World Wholesale Report

Published 9 January 19

Prices were mixed across the different products in world wholesale markets in December, though trends were similar for the main three regions. Butter and cheddar prices were down on the month, and WMP saw only marginal movements, mostly downwards. Meanwhile, SMP prices were up on the month, particularly in Europe.

EU butter prices continued their decline, but by less than last month. Lower prices encouraging sales, and seasonally strong demand, have provided some support to the market. However, the premium over NZ prices remains which is limiting export interest. WMP prices have been steady to slightly down, while SMP prices have risen thanks to unexpectedly strong demand for the time of year. With nearly 75% of intervention SMP now sold, its weight on the market is easing, and some reports of uncertainty surrounding availability of fresh SMP supplies may also have supported prices.

New Zealand continues to have strong production relative to the previous year, while Australia has been struggling. Oceania average butter prices fell at the start of the month, then firmed through December supported by increased demand around the holiday season, but overall still declined on the month. SMP prices increased, with manufacturers reportedly holding some supplies back in anticipation of firmer prices, which in turn helped to firm prices. WMP prices were up marginally. Cheddar prices were down following active production and reportedly heavy stocks.

US prices followed the trends seen elsewhere. US milk yields tend to increase in late autumn, providing ample milk and cream for cheese and butter, which pushed down prices for both products for the month. For powders, SMP prices were up, while WMP prices were steady.

World Wholesale Table