Greg's Milk Monitor 1 November 2024: They’re ‘avin a larf…..

… them Dutch traders. Yes, in a market awash with the stuff, they’ve pushed skim milk up €20 this week! And now the premium over the German market is €120 (yes, that is correct), and the haulage  differential is no more than €50, I’m sure German processors are playing ‘hunt the buyer’ in Holland. All of which means there’s no change in the real market and the next move is likely to be downward.

Sweet whey is doing the sensible thing, and declined €20 this week, same fundamentals as skim, as buyers sniff blood. Everything else in the blenders' arsenal remains plentiful, even gluten, which has been rather held to ransom of late.

The US soya harvest is 90% done, fastest in a decade and planting is catching up fast in Brazil, but both beans and soy oil remain broadly unchanged, with only meal dipping $20 this week, currently in the high $290’s as I write, the first time there’s been a 2 in front since July 2021. Palm oil is yet higher, reaching prices last seen two years ago, and if the aberration of H1 2022 is removed, a record high price.

BDC agri is the UK broker for Lacto Production milk and whey powder products.

For further information and prices, contact Greg Dunn on 01206 381521 or g.dunn@blackdiamondcommodities.com

Greg's Milk Monitor 25 October 2024: Damp Squib?

Well, skimmed milk down €20 (-0.8%) and sweet whey unchanged certainly doesn’t have the whiff of a collapsing market. There is still a battle royal going on between the Dutch and German markets, as the traditional price premium of €30 for Germany was eroded back to parity by June, to plummet to a whopping €110 by the end of August, as the Dutch traders sent their market sharply higher. That discount is still €65, but there are signs that the Dutch market will fall back into line, as there are ample offers under the market, and downgrades are coming out of the woodwork. But, ’tis what ’tis, so we have to work with an official unchanged market, and the graph shows how relatively flat the market has been these last two years.

Skim milk tells much the same story, the traditional German discount under the Dutch market has opened out to €100 from the usual €50, stocks are popping up everywhere and downgrades a plenty. 

 So not a sign that either market will rise imminently, pressure has to remain downwards, but the market is taking its time to address the oversupply.

It’s a similar story in global soya markets, which still haven’t woken up to the fact that the largest soya crop in US history is 15% ahead of the five year harvesting average, to the degree that farmers will run out of storage and good old fashioned ‘harvest pressure’ should come in to play. Soy oil really does take the biscuit, up 12% since the mid September sub 40 cent lows, on the strength of larger biodiesel usage, and palm oil is off the scale, up more than 25% since the August lows on confirmation that B40 becomes statutory in Indonesia come January 1st 2025, followed by B50 a year later.

BDC agri is the UK broker for Lacto Production milk and whey powder products.

For further information and prices, contact Greg Dunn on 01206 381521 or g.dunn@blackdiamondcommodities.com

Greg's Milk Monitor 17 October 2024: Traders' Paradise

Both milk powders down €30 this week, whey by 3.3% and skim by 1.2% as traders buy in their short positions and put the screw on processors, who have to their utter surprise found copious stocks that just weren’t visible a fortnight ago. Both commodities look set fair for further declines, but other processed powders are proving stubborn, as fat-filled whey is still at record price levels with little chance of a break and gluten is stuck at €2200 with rumours of shortage.

The other factor limiting blends declining is a surprise shortage of delactosed whey, which puts €10 on milk replacers.

Regarding my obsession with butter and the price frenzy, it appears production in August did fall back within seasonal trend line, so the skim milk stockpile isn’t growing exponentially.

The US soya harvest is going gangbusters, 15% ahead of the 5 year average, and planting conditions in Brazil have improved, which has brought beans below 10 cents for the first time since August, but strangely left meal and oil broadly unchanged, especially since the heat has come out of crude oil markets for the time being.

BDC agri is the UK broker for Lacto Production milk and whey powder products.

For further information and prices, contact Greg Dunn on 01206 381521 or g.dunn@blackdiamondcommodities.com