Daily Dairy Update: Lack of demand? Or lack of buyers?

Yesterday was a quiet day from our side. Buyers were stepping out of most markets so we were left without one side of the market. Of course, we see buyers, but they are on a much lower level than we have seen in the previous days. Sellers seem to overthink their strategy. Most acknowledge the fact that lower commodity prices are needed to attract buyers, but none seem to want to get ahead of the market. We hear offers from producers are sliding down slowly, but it seems not a lot of volumes get sold. 

We agree the bids for most commodities are (for now) on the low side. But looking at the imbalance between sellers and buyers for Q2 we see the opposite of what we saw in February. In our update Lack of Product? Or lack of sellers? we explained that we thought the bullish moves in February were caused by a lack of sellers, not by a lack of product. At the moment we don't think we see sellers are back, but the buyers are well covered. The good news for sellers is that we think if they drop their price quickly enough they will get the buyers back. But by reducing the price with small steps, we see the buyer move back at the same pace. Buyers in February proved that by stepping up with the bids quickly they were able to bring back the sellers, we believe sellers can bring back the buyers by coming to the market with attractive prices quickly.

Without much new information, we keep the update short.