As Irish processors either held or slightly increased milk price for February, the global market remains more or less steady as she goes. As described last week, the 6.3% fall in the GDT paints a slightly negative angle, but that is for a small volume of powder product.
As Irish processors either held or slightly increased milk price for February, the global market remains more or less steady as she goes. As described last week, the 6.3% fall in the GDT paints a slightly negative angle, but that is for a small volume of powder product.
Decent New Zealand supply has helped Kiwi volumes, as they are now in the back-end of their production season and this affects the GDT auction results.
There are contrasting opinions among the experts on what to expect for the European spring and summer product. Some Irish processors suggest the spring flush could push volumes up and price down slightly, but others say European prices and debt repayment issues will not generate enough milk to destablise markets. I’m in the steady as she goes camp at the moment, especially considering the current Dutch slaughter of dairy cows and the very real lid that has been placed on milk production from the Netherlands as phosphate rules dictate cow numbers.
The US continuing to pump out milk is one to watch and, as we enter full flow in Europe, there inevitably will be more skim milk powder created, which will put pressure on margins, but Irish processors have to deal with that every spring.
The IFA’s Sean O’Leary said: “EU Milk Market Observatory reports would have yielded just under 37c/l gross before processing costs, or a milk price equivalent of 32c/l + VAT (33.7c/l incl VAT).”
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