The levelling off I spoke of last week hasn’t happened yet, with whey up €20 and skim milk up €10 over the week.

Reasons cited for the hike in whey hinge on a reported reduction in cheese production, pushing up cheese prices and whey with it, as production has slowed. This hasn’t been borne out in terms of supply, as whey is freely offered with sellers happy to accept higher prices. Traditionally, this would usually presage a slide when increased Christmas cheese production kicks in, but the uncharted territory we are now in could see a reduction in cheese production, and thus sustain further rises. My feeling is that the rise won’t continue much longer, as supply seems to roughly exceed demand as things currently stand, and without a continent-wide hospitality lockdown, the balance sheet should remain stable.

Skim milk is still being driven by export demand, but the rises are levelling off, so hopefully skim will plateau soon. But a rapid slide certainly doesn’t look likely until deep into Q4 at the earliest.

Sterling continues to unimpress, as the dollar regains safe-haven status and the Eurozone struggles with dire PMI figures but still remains dominant over the pound.

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