Bearish Butter Business

Yesterday was an active trading day... if you were in the butter business. The butter market traded down again and we see more sellers coming to the market hitting the lower bids we had. We still see that most action comes from sellers in June and Q3 and less for Q4 and Q1. The market for SMP and Cheese was very quiet and didn't show any action from our partner's side. 

The low activity from the side of end users seems to be the biggest concern for our partners. Butter demand for June + Q3 is very low and the offered volumes from the side of producers are increasing. But the prices that producers quote are much higher compared to the market trades we have been seeing in the last weeks. This seems to be the case for all products we broker. We see more and more delays between our partners and the request from buyers to store products a bit longer (and sometimes quite a long bit).

Some additional concerns from our sellers seem to come from the relatively slow liquid markets. Demand for SMC from the south of Europe is ok, but demand for cream and raw milk is low. We hear more factories are trying to sell cream and raw milk forward for July and August, but buyers are very reluctant to pay a premium against today's market. Cream prices today started high, but we hear the lower trades were done at € 5200,- with additional volumes still available in the market.

But those with bullish glasses looking at the market have reasons to be bullish about. It is still very hard to find sellers for Q4 + Q1 for both physical and on futures although prices have been slowly correcting down a bit.