Forward prices still showing a premium

Published 18 January 17

AHDB Dairy’s Forward Market Performance (FMP) indicator is continuing to show a premium over current prices. The latest numbers show that, despite wholesale prices increasing over the last few months, those trading futures still believe demand will outstrip supply in the spring.

FMP is the difference between the EU AMPE and the EU FMPE, where FMPE is the Future Milk Price Equivalent 4 months in advance. FMPE is calculated in the same way as AMPE but using settled futures prices from the European Energy Exchange. We focus FMPE 4 months in advance as this is normally the period where most trade is completed. Both AMPE and FMPE are quoted in Euros to limit exchange rate impacts.

FMP Jan17

Source: AHDB Dairy/EEX