30 May 2024: Milking it

Another €50 jump for skim milk this week, whilst sweet whey posts unchanged again. 

News from the buying side suggests that while certain national markets are dribbling out skim milk to maintain the hike, other central and outlying dairy markets are happy to release product to avoid overstocking. Although the Dutch numbers for April and May haven’t been released yet, the sharp upward trend in production in Q1 suggests stocks must be building, despite more brisk demand. 

Other markets are quiet, the soy complex is still ignoring what’s coming down the line and holding up on beans and meal, whilst soy oil remains stable. Palm oil is looking inwardly at its own fundamentals and surprisingly bullish, but always has to play second fiddle to soft oils, which don’t currently support further increases. 

Sterling is interesting, as it reacted positively to the prospect of a socialist landslide when the general election was announced last week, certainly not what used to happen in the olden days, but the three-term life cycle of the major parties  probably underpins the confidence in administration change. 

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

23 May 2024: Here we go again ...

After the equilibrium of the last two months, it look like we’re off to the races again. Skim grabs the headlines this week, up €60, the best part of 3%, but sentiment has fundamentally changed. In short, we’re in peak spring milk supply, but processors claim demand is already outstripping supply. Lacto Production has seen a fortnight’s orders land in one week, so demand is palpable, and the processors have been stumping up to secure liquid milk, so they argue to steep rise in skim is defensible. (Note to market - that’s what they said last time, withheld product, over-milked the price rise, then endured the collapse in values). 

However, ’tis what ’tis for the time being, so further rises almost definitely on the cards in the short term, with the logical extension in production time for blends.

Sweet whey is also a tad firmer, up only €10 on the week, but a total of €30 since early April, so 5% higher, certainly not any sign of weakness. Wheat gluten is still critical, with two factories out of production currently. 

Not much going on in the background, mineral oils still on the downside, but global soya prices continue to cling on to short term bullishness, ignoring the area increases expected in all production areas. 

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

15 May 2024: Demand overtaking supply?

Just knocking out a quick market report between the two days of the Pig & Poultry Fair. In short, no change in whey, skim milk down a paltry €20, less than 1% and no material change to spot supply prices. 

However, the status quo looks to be challenged on the upside, as purchasing activity is definitely on the up, and offers from suppliers are not as ready as in April, so the next move, when it comes, looks to be northwards. Having dropped to as low as a week back along, supply from the factory is now out to two and a half weeks from order, plus delivery, so tangible evidence of returning confidence.

In a correction to last week’s report (thank you to my eagle-eyed reader), the flooding in Rio Grande do Sul affects 34% of the remaining unharvested are, as the job is pretty well done (80%+). However, despite the mega national Brazilian crop, the weather market still supports beans, meal and oil at pretty much unchanged levels over the week, with palm oil mirroring soya.

Back to the overheated pleasures of the NEC …..

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