Greg's Milk Monitor 11 April 2025: Immolation Day

Trump’s so called ‘Liberation Day’ has caused chaos in many markets, but it looks like milk powders have been spared, at least for the time being. The largest swing factor has been the sterling:euro exchange rate, as the pound has lost 6% of value in a fortnight, forced down by economic factors unrelated to Tariffgate. 

Sweet whey has shed €20 while skim milk has risen €10, and the word is that real values, although still higher than stated, are easing slightly for whey, if not for skim, where edible quality is now actually cheaper than feed grade. This has come about because demand in the edible sector has been sluggish at best, whilst feed sales have been booming for over four months. This does now seem to be slowing, and order times have now reduced to four weeks.

Prices and supply are still high and tight for WPC, hydrolysed gluten and fat filled whey, and coconut prices have breached €2800, from €1800 a year ago.

The soya complex dropped off after 2nd April, but bounced before the big backtrack on tariffs to levels higher than previously, which is counterintuitive given that the South American crop can supply all China needs, circumventing 125% tariffs. Palm oil has dropped, though, but on its own fundamentals.

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

For further information and prices, contact Greg Dunn on 01206 598657 or greg@bdc-agri.com

Greg's Milk Monitor 3 April 2025: Tariffic or Tariffying?

Sweet Whey - €10

Skim Milk unchanged

Following last evening’s presidential proclamation on tariffs, and trying to predict the effect on global milk powders, on the face of it, it doesn’t look bullish. Just taking whey, the cumulative 10% global tariff plus 35% Chinese tariff increase on imports into the US is likely to be met with a robust and equal response, and thus put US whey export prices so far out of court that the EU will be the market of first resort. This arguably could be bullish for our home markets. However, the domestic US price has been going through the floor during Q1, so the tariff news is unlikely to slow that decline down any.

The markets' knee-jerk kicked off about 2% down when the bell rang this morning, but are coming off the lows now as profit taking by day traders kicks in. Sterling and euro rates against the dollar soared, but inexplicably the pound has lost a cent to the euro during today’s trade.

Regarding milk powder blends, no fresh news in the market, other than off grades are starting to be offered, usually a sign that processors reckon the market’s overdone. Refined palm oil is stable at just below €1600, but the disease problems affecting the coconut palm are continuing to send prices into the stratosphere.

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

For further information and prices, contact Greg Dunn on 01206 598657 or greg@bdc-agri.com

Greg's Milk Monitor 28 March 2025: Market manipulation?

Anyone expecting the milk powder markets to ease might well disagree with the above statement. Although sweet whey posted unchanged for yet another month, skim milk jumped by €20 to recover last week’s loss. On a recent tour of Germany, the intelligence seems to be that processors are choosing to store product rather than take lower prices, now that the FMD containment measures have retracted to only include Brandenburg and a couple of boroughs of Berlin. We all know that ends in tears when there is a sustained fall in whey markets, when prices fall out of bed to lower than cost of production, to clear the stored backlog, but there is another factor at play now.

That is the amount of whey and skim that is being consumed by an insatiable increase in demand for whey protein concentrate and milk protein concentrate, that is materially affecting the amount of primary material available for a still-buoyant feed market. What we lose on the swings in skim and whey we partially regain on the roundabouts in in terms of the cheaper byproducts of WPC and MPC, namely permeate and lactose, but the whole price basis looks to remain firm.

It's a topsy-turvy world when WPC at €2700 is €250 over skim when it traded happily at exactly the same discount under SMP, but that is caused by the demand that is coming from both edible and animal feed use.

On the other hand, we see farm gate milk prices at sustained highs, and pork at nigh on €2/kg deadweight, so processors argue that the end market can afford higher milk powder prices.

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

For further information and prices, contact Greg Dunn on 01206 598657 or greg@bdc-agri.com