The gap between the quoted and physically available prices for skim milk is narrowing, with the Dutch market posting €50 gains, making spot price €1900, opposed to the €2000 it is possible to buy at. Whey has jumped up €30 this week, as expected, but there is more availability. My mid-lockdown theory about cheesemakers mothballing production is totally reversed, as particularly the French are munching their way through enormous quantities of Emmental at home, whilst mozzarella is still at a standstill due to the collapse in pizza demand, so there is plenty of whey about, and that may well cap this rise before we get to Q3. Brands like President (butter and camembert) are experiencing record sales, and are certainly present in the fridge at Dunn Towers, as is newly arrived skim milk powder, the first since lockdown. Whey traders in particular are happy to surf the new wave in skim milk, so it will probably take several weeks for whey to plateau.

Skim milk supply and demand is a puzzle, though, as French dairy producers are still getting high prices at peak production, despite the warnings of doom and gloom further ahead. This must be domestic demand, as compared with countries like the Czech Republic reporting milk prices at nearly half the French levels, the demands of dairy giants like Lactalis and Sodiaal for reduced production and prices will be enforced by imports.

Sterling is a basket case again, more than three cents off recent highs against the euro for no identifiable reason. Perhaps traders' suspect Cummings seems happier to throw the red meat of a no deal Brexit to the redhead press than modify the government’s stance in dealing with the post-Covid bomb site of the economy.

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