25 April 2024: Flat calm

Another short report this week, whey unchanged, skim up an imperceptible €10. Only hydrolysed gluten supply has gone critical recently, but all milk powders are in balance. The balance is significant, as off take has continued to be brisk, as is the supply of spring milk. 

I’ve already used the Groundhog Year soubriquet recently, but these charts certainly show the almost identical factors in play, this year over last. The question is, how much of both skim and whey is stockpiling through the milk glut?

Soya oil is broadly unchanged this week, up slightly, but palm oil has crashed by 15% during April so far. The biofuel influence isn’t bearish, as although crude oil has dropped well below the recent $90 a barrel, the Iran/Israel crisis never really got factored in to biofuel.

Sterling has recovered a little from the bashing the markets gave the bearish interest rate signals coming from the BoE, but generally feels uncomfortable above €1.17 or $1.25.

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

18 April 2024: Strongly sideways

Just a short one this week as I’m on the road. Market basically unchanged, so no price change on last week.

Whey producers are adamant their price won’t break €620, so are standing firm everywhere except Italy, where the largest processor is discounting, but not by the haulage differential to deliver to Holland.

Likewise skim milk is at what producers insist is the bottom for them top stay at break even.

Against that, production is flat out on both markets, so it all has to go somewhere, and bunging it in store and taking the pain later looks to be where the market might be taking producers.

Soya oil is down another 5% or so, and palm oil more so, given oil has been held artificially high. 

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

4 April 2024: Dead cat bounce or a genuine bottom?

An interesting week for milk powders, as we see sweet whey unchanged but skim milk bouncing €50 (+2.3%). The word on the wires carries on from last week, in that traders are buying, and have largely ceased offering, which has brought buyers out of retirement en masse, so a genuine sea-change in sentiment.

Outside markets are definitely playing a part, led by crude oil, which is approaching $90 a barrel. This is classic 'sell on rumour, buy on fact’ territory, as the rise is predicated on OPEC+ agreeing to cut supply further, ignoring the fact that the biggest inventory of them all is seeing stocks rising sharply.

The rise in crude oil has got vegoils excited, as soy oil has risen a couple of percent whilst beans and meal have decreased, but palm oil has put on over 12% over the last month. It is like an old western movie, someone shouted ‘Indians’ and the wagons swiftly pulled into a circle and up went the barricades. Indian palm oil imports have actually decreased to a ten month low, as sunflower oil has offered better value, but the betting is that the upcoming Eid al-Fitr festival will revive demand and sustain the higher levels.

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