June brought some firmness back into global dairy markets as milk supplies remain tight. Northern hemisphere milk supplies started declining again post-peak, while the southern hemisphere is in its trough. However, it was still a mixed picture as some demand resistance is starting to show and offset the support from tight supplies.
EU price movements were quite small in dollar terms. The fall from peak following a lower spring flush is keeping supplies tight. This is still supporting the market overall. However, high prices are starting to weigh on demand for some products, and we saw declines in some powder prices this month. For more detail, see our EU wholesale page.
Oceania saw powder prices rise on the month in June, but butter and cheese weakened. For powders, SMP supplies were tight against good demand as milk production remains seasonally low. Active buying from North Asian countries, and the re-opening of some Chinese ports after a Covid lockdown, helped support this. WMP prices were supported by tight supplies, both seasonal and from some redirection of milk to more profitable avenues. Butter prices fell in the first part of the month with a lack of trade but started to recover later. Cheese markets were described as “unsettled”, with buyers holding off.
US markets were in contrast to Oceania, with a strong increase in the butter price but only marginal gains for powders. For butter, staff shortages and higher cream multiples were reported to have kept a cap on production, helping prices stay supported. Powder markets were fairly quiet, with buyers holding off in the hope of lower SMP prices, and with quite spot markets for WMP. Cheese prices fell 2.7%, with demand softening at both retail and food service.