Weaker Demand and Growing Supply

The first two days of this week have been quiet. A lack of buyer interest is keeping activity low. Producers and traders confirm the trend. After the recent bullish moves, many buyers secured higher levels for both cheese and butter and now feel well-covered for the months ahead. With futures softening, a weaker GDT, and growing milk volumes, there’s little urgency to return to the market. Producers and traders, meanwhile, had expected to see more buying appetite for Q2 by now and are left reviewing stocks and forecasts. Two strategies are on the table: hold steady and wait, or get ahead of the market and start offering, even at lower levels. The first option is clearly in favour, as the latter has delivered little return in recent months. The result: low activity and growing pressure. Commodities like butter and cheese may absorb pressure slowly, but the liquid market tends to react more quickly.

GDT: Weakness for EU Products

As is typical for a GDT Tuesday, all eyes were on the tender. While the overall index rose 1.1%, the result was skewed by an unusual spike in UHT SMP trades. Strip those out, and the tender would have landed more or less flat — as expected.

AMF saw a modest recovery at +2.3%, though still well below butter. Butter itself closed 1.2% lower. In the EU, Solarec traded between €7250 and €7350, while Kerry butter didn’t exceed €7100.

WMP held steady, and SMP aligned closely with previous GDT levels — again, excluding the anomalous UHT premium. Mozzarella dropped by 4%, bringing prices back to €4170, confirming the downward trend seen in EU cheese markets. All in all, a bearish signal for EU dairy on the GDT.

FMD: Rising Concern in the EU

Back in Europe, the FMD situation continues to worsen. New cases have been confirmed in Slovakia, and multiple sources express concern about possible cases in Austria. If confirmed, this would add yet another EU country to the list of those affected. Hopes to contain the outbreak are fading, and anxiety around the spread is growing.

Liquids: Milk Flows Up, Sentiment Down

Despite resistance to the "more milk" narrative, the data suggest otherwise. Spot prices for raw milk in Germany are trending around 47–48ct, while coops are lifting contract prices for April. Cream prices in Eastern Europe are converging with the West. NL/BE cream trades around €8550–€8600, while Eastern quotes vary between €8500 and €8700. Bulls point to last-minute easter demand as a potential driver, but more voices expect a downward correction. Meanwhile, SMC continues to face pressure, with prices between €1700 and €1800 — and little indication of a rebound in sight.

US: New Tariffs Effective Immediately

The U.S. is expected to announce a new round of global trade tariffs. No details leaked in advance, but the changes take effect immediately and apply to all countries at once. Early indications suggest EU dairy could face a 50% import duty. While it’s too soon to calculate the exact impact, such a move would undoubtedly weigh on EU commodity prices. As global trade enters a new phase of volatility, the outlook is one of uncertainty, risk, and rapid change — less opportunity, more disruption.

Butter: Offers Growing, Bids Falling

The butter market sees growing supply — or rather, shrinking demand. April needs are being filled as producers begin offering again to traders. We hear German and Dutch producers offering between € 7300 and € 7350 for April. End users have mostly secured their Q2 positions and are shifting focus to the second half of the year.

Futures remain heavily backwardated, with Q3–Q4 expectations hovering between €7000 and €7100. Sellers, however, still aim for €7250+. While that’s still a discount compared to spot, buyers are cautious. The steep backwardation is puzzling. Logically, Q2 prices should be lower than H2, but H2 remains stuck, meaning Q2 may need to correct downward before liquidity returns. With strong cream prices, that shift may take some time. Recent trades ranged from €7225 to €7325 — a small step down, but selling pressure continues. The bid-ask spread is widening.

From the US more butter seems to be coming to the EU. Prices on the CME are still under pressure and we see offers for US butter at $ 6250 CIF Rotterdam, while buyers are aiming for roughly $ 150 lower.

Expected offers:

• 4 trucks of Irish butter for May at €7250
• 6 trucks of Irish butter for May–June at €7225
• 6 trucks of Irish butter for Q3 at €7200
• 6 trucks of NL/DE/BE butter for Q3 at €7275
• 2 trucks of fresh Arla butter for April at €7375

We haven't seen any changes in the cheese and SMP market since our last update. Demand for cheese isn't great, although sellers aren't offering overly aggressively. We would not be surprised to see the cheese market continue to trade sideways.

Conclusion

The start of this week is defined by hesitancy: buyers staying put, sellers weighing their options, and macro developments adding a layer of uncertainty. The pressure is building — some of it quietly, some of it faster than expected. Markets don’t stay still forever. When the next move comes, it might be sharper than many are prepared for.