On the supply side of global dairy markets, milk production has been negatively impacted a number of times in the last year, with New Zealand experiencing a severe drought in December and January, while an extended winter curtailed the seasonal peak in Europe. Set against this backdrop, dairy prices have held firm and even increased in recent months, particularly in Europe.
On the supply side of global dairy markets, milk production has been negatively impacted a number of times in the last year, with New Zealand experiencing a severe drought in December and January, while an extended winter curtailed the seasonal peak in Europe.
Set against this backdrop, dairy prices have held firm and even increased in recent months, particularly in Europe.
While supply has played its part, strong demand in some key dairy import markets has also underpinned firmer dairy prices over recent months.
The 2018 World Cup in Russia has undoubtedly played a role, while the rising price of oil has also boosted buying power for dairy importers in oil economies in the Middle East. However, more important is the continued strong dairy demand from China.
The world’s largest dairy importer continues to hoover up large volumes on a monthly basis.
For the first four months of 2018 (Jan-Apr), Chinese dairy imports are almost 7% ahead of last year in volume terms at just over 800,000t.
Imports of infant formula are running at 36% ahead of last year at 109,000t in the period, while whole milk powder (WMP) imports are also slightly ahead of last year (+3%).
Chinese whey imports for the first four months of 2018 are up 5% year on year.
Overall, Chinese demand for dairy is in a healthy place, with total imports for the first four months of 2018 almost 50% ahead of the same period in 2015, when demand almost collapsed.
This is a subscriber-only article
SHARING OPTIONS: