In what is a further signal pointing to a recovery in the dairy markets, last week was the first week since September 2014 where no volumes of butter were offered into the private storage aid (PSA). The previous week, 2,297t were offered into PSA.

So far in 2016, a total of 143,587t of butter have been offered into PSA, with 306,510t being offered since the PSA was first introduced.

According to the European Union’s Milk Market Observatory, Ireland accounts for 13% of the 306,510t of butter in the PSA. This up to the week ending 9 October. The Netherlands, at 43%, accounts for the largest proportion of butter offered into PSA.

SMP overhang

However, there still is a skimmed milk powder (SMP) overhang in the market. Since the start of the year, a total of 255,894t of SMP have been offered into intervention. Last week was the fourth consecutive week that no volumes of SMP were offered into intervention.

Irish prices

Domestically, milk price has seen a continuation of the recovery. On Thursday, both Lakeland and Glanbia decided to increase their respective milk price for September.

Managing director of Ornua’s dairy trading and ingredients division Joe Collins told the Irish Farmers Journal this week that an early 2017 milk price of 28c/litre to 32c/l was probable.

Dairy trends: has the growth in whole milk powder prices crested?

Butter into private storage dries up

For the first time in over two years, no butter was offered into private storage aid (PSA). Meanwhile, skimmed milk has again not being offered into PSA.