Daily Update 3th of March

Yesterday was a relatively calm day for the dairy market. Market participants seemed to have found a trading level where both our sellers and buyers found acceptance.  And without much information from outside of the dairy market, we have little exciting news to report on. 

Most milk prices for March are out, and we see the bigger coops in the Netherlands all paying roughly 50ct for March. Those with strong retail businesses still have a large portion of their milk sold at high levels. Only those producers who focus on commodity sales are going down quickly. But the spread seems to be 45ct on the low end and 51ct on the high end. We don't think it will impact production just yet. Speaking to farmers some of the high costs have come down just as quickly as commodity prices, lowering the cost price of milk and keeping farmers' profits still ok.

We expect another calm day tomorrow. Most traders seem to wait for lower offers from the producers, and speaking with them it doesn't feel likely they will come down much with their offers today. Maybe if pressure mounts in the coming weeks due to lower liquid prices we might see some movement. Cream is creating toward the € 5000,- level, we think that if we break below the € 5000,- level for cream, we might see some action on butter again. Cheese and SMP prices seem to be nearing a strong bottom, so we don't expect much price action on these two commodities either.