Last week, European butter prices fell by €300/t and this week European butter prices increased by €270/t, more or less wiping out last week’s blip and returning the staple to its high price.

At last week’s Global Dairy Trade (GDT) auction, butter was the star performer, increasing in price by 6.2%.

It was a mixed bag for the other commodities, with whole milk powder (WMP) remaining unchanged at €3,800/t, while skim milk powder (SMP) fell by €60/t to €2,350/t and cheese continued its steady gain to reach €4,400/t.

There is certainly more buoyancy in the market than there has been for most of the year and the outlook is looking good also.

Demand is increasing in places like Germany and even though supply there is up 0.33% for the first few months of 2024, it has been lower at the end of May by 0.2% compared with last year.

Milk production in the main US dairy states is down 0.7% for May 2024 compared with May 2023.

This is a significant reduction and comes on the back of 52,000 less dairy cows compared with May 2023, although the USDA says that there are 5,000 more dairy cows in May 2024 compared with April 2024.

One interesting element of the data is the split in supply profiles.

Traditional dairy states in the northeast are continuing to drive on production, while the drier regions in the southwest are struggling, with states such as New Mexico - where Glanbia has its cheese plant - down almost 15%.