The strong performance of butter is resulting in a continued weak market for skim milk powder (SMP).
SMP prices at the Dutch auction this week fell to an eight-month low of €1,700/t, down from €1,750/t last week.
Butter prices were up from €4,250/t last week to €4,310/t. With butter performing well, pressure is on SMP.
Larger players are selling SMP in the Middle East at or below the intervention rate of €1,690/t.
There is a growing sense that intervention will be reopened to deal with the struggling SMP market. There is over 350,000t of SMP in storage from last year.
GDT
Meanwhile, this week’s GDT saw average prices rise by 1.7%. Prices for WMP increased by 2.9% to $2,855/t, SMP fell by 10.1% to $1,948/t but butter rose by 4.9% to $4,910/t.
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