Weaker Fats? Not on the GDT!

The first two trading days of the week were, once again, anything but dull. Cheese prices remain under pressure, butter continues to edge lower, and there’s a flicker of fresh demand for SMP. With most partners finally back at their desks after a slew of bank holidays, yesterday had the feel of a “normal” trading day — whatever that means in dairy. And if anything screamed dairy commodity trade, it was yesterday. Markets felt jumpy, and a far more bullish GDT than expected sent many partners back to their drawing boards. So, let’s unpack what happened.

Starting at the top… After a relatively uneventful Monday, trading kicked off Tuesday with surprising momentum. Some sharp Polish butter offers and sluggish cream trades prompted Eastern EU producers to liquidate some built-up stocks. Butter slipped as low as €6,850, pulled down by cream prices between €7,700 FCA Baltics and €7,850 FCA Western EU. The availability of cheaper nearby product opened the door to discounted Q3 deals, dragging butter as low as €7,100.

Cheese wasn’t feeling particularly bullish. We heard from traders facing stiff competition, with Gouda offers hovering around €4,200 DAP Eastern EU and Mozzarella around €4,050 FCA Germany. Nearby demand remains soft, and with milk peaking in Western EU, producers appear able — and willing — to offer a little extra. Only on SMP did we see some spark, with modest interest at slightly firmer levels than last week. Buoyed by stronger-than-expected ONIL tender prices, sellers hiked offers in hopes of better results in the GDT.

GDT: Bullish — but not where we’d expected

Then came the GDT. Kerry butter trades landed early, with overwhelming demand at $7,850 the next round posted prices up to $8,100 — and stopping there. With no buyers at $ 8100 it seemed prices rolled back toward $ 7850, setting Kerry prices at € 6950 roughly. Solarec traded just as anticipated, with averages of €8,155 / €7,200 slipping around €100. The real surprise came from NZ butter, trading well north of $8,000 for nearby — putting some EU-origin butter below Kiwi prices. NZ AMF also firmed, though that was hardly a surprise if you've been reading the updates.

As for SMP, we were leaning slightly bullish after the ONIL tender beat expectations. But GDT prices held steady versus the last event. The official line says +0.5%, but we’re struggling to spot the difference in Euro terms. Solarec was the only one showing a small uptick in Euros — and barely any in dollars.

Cheese delivered the biggest eyebrow-raiser. EU Mozzarella has been under pressure recently, with offers between €4,050 and €4,100. Yet the GDT showed prices as high as €4,200 — defying logic, as we would’ve expected a 2–3% drop. Cheddar was even more bullish, jumping over 12%, catching us completely off guard.

WMP also packed a punch with a 6.2% gain — the biggest lift of the session. We expected some strength, but 6.2% was not in our crystal ball. A strong result overall, pointing to continued export demand. Still, EU product doesn’t seem to benefit much: WMP remains uncompetitive, SMP can’t shake off its price ceiling, and EU butter looks heavy despite Kiwi support.

Liquids: Peak Milk in Full Force

In the liquids market, seasonal pressure is peaking — and nowhere is that more evident than in cream. France, Spain, and the Baltics are showing levels between €7,700 and €7,800, while Germany and Poland report highs of €7,850 to €7,950 FCA. Top prices hit €8,050–€8,100 DAP Germany. Visibility in raw milk and SMC remains poor. There is some forward interest for cream, with H2 indications around €8,200 FCA — though so far, no counters.

Butter: Down, Up… Down Again

Butter is doing its best impression of a yo-yo — albeit within a tighter range. Gone are the €1,000 swings of yesteryear; we’re now seeing moves of €100–€150. We traded Q3 at €7,150 after buyers pulled back bids to €7,000 — only to return at €7,145 before close. Polish lactic buyers are active around €6,900; Irish lactic draws interest at €7,000.

Given current cream levels, sub-€7,000 butter makes sense. Historically though, Q2 butter has traded above its cream equivalent. If cream prices stay under €8,000, we should see butter follow down — the current spread between cream and butter remains oddly wide.

We’re supporting the market with the following bids:

• 2 trucks Solarec fresh for May at €7,150
• 4 trucks Irish butter for June at €7,025
• 4 trucks Irish butter for July at €6,950
• 6 trucks NL/DE/BE butter for Q3 at €7,100
• 6 loads Polish lactic butter for May at €6,900

Cheese: Still Searching for Direction

The cheese market feels… confused. We’re hearing reports of slow purchasing, yet producers are standing firm on offers. Cheese is aging a touch, but nothing alarming. Demand is steady, if unremarkable. There’s plenty on offer — yet no one seems to be aggressively selling. Trying to find a price discovery moment right now is like chasing shadows.

Current buying interest includes:

• 6 loads Mozzarella for May–June at €4,000 DAP NL
• 6 loads Gouda for May–June at €4,150 DAP NL
• 4 loads Mozzarella for July at €4,050 FCA Germany

Powders: All Bids Welcome — But Only the Good Ones Count

Discussing the SMP market with a seasoned partner, we came to a simple truth: there’s plenty of buying interest below €2,300, and just as much selling above €2,400. Between the best bid and sharpest offer lies a vast, empty canyon. As he put it:

“Wouter, I’m not short on bids — I’m short on good bids. And those are rare.”

When asked what qualifies as a good bid, he answered dryly:

“Starts with a 2 and a 4 — what comes next is a bonus.”

With SMP underwhelming in the GDT, we don’t expect those quality bids to become any easier to find.

Current bid ideas:

• 200mt SMP medium heat, Irish origin at €2,200 for May/June FCA Ireland
• 300mt SMP medium heat, German origin, with export docs at €2,300
• 300mt SMP low heat at €2,300
• 200mt SMP non-standardised at €2,325

Conclusion: Clarity Remains Elusive, But Signals Are Forming

This week's trading rhythm suggests we’re entering a period of recalibration rather than resolution. Markets are reacting more than they are trending, and participants seem torn between fundamentals and sentiment. Volatility is compressed, not absent, and confidence feels fragile — both on the buy and the sell side. If anything, the GDT has thrown a wildcard into the mix, reminding us that global cues still carry weight, even if they don't always align with EU realities. Eyes will now turn to milk flows, cream behavior, and whether buyers grow bolder or just better at sitting on their hands.