When viewed in historic terms, cheddar prices are steady, butter is commanding decent returns and milk powder prices have improved dramatically in the last 12 months.In saying that, the recent cuts to milk prices announced by co-ops have some foundation. Since the end of May, butter prices have weakened by almost €800/t to their current level above €3,300/t.
When viewed in historic terms, cheddar prices are steady, butter is commanding decent returns and milk powder prices have improved dramatically in the last 12 months.
In saying that, the recent cuts to milk prices announced by co-ops have some foundation. Since the end of May, butter prices have weakened by almost €800/t to their current level above €3,300/t.
On the cheese side, cheddar prices have held steady this year just below €3,000/t. However, since Boris Johnson became UK prime minister, the uncertainty around Brexit has increased sharply and the value of sterling has weakened to record lows of almost £0.94 against the euro as the risk of a no-deal Brexit intensifies.
With over 50% of Irish cheddar exports destined for the UK market, the profit margins for Irish co-ops exporting cheese to the UK market are becoming increasingly thin.
There has been a welcome rebound in the price of skimmed milk powder (SMP) above €2,000/t with exceptionally strong export demand underpinning this. However, the improved SMP price has not been enough to offset weaker returns in cheese and butter markets.
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