ROLAND SOSSNA, Editor International Dairy Magazine: recovery will take more time. The US market is better off that that in the EU

roland-sossna-180-1The latest and recent intervention of SMP in Europe was in effect unable to clear the milk protein markets from oversupply. Admittedly, product has gone on stock so that it needn’t be sold into markets at once. But that same SMP that is already in storage or is going  into storage, will return one day.

When it returns, however, there should be at least an even balance of supply and demand in the markets. As things are, no such thing is going to happen anytime soon; at least not in Europe. If it was not for the record high prices for butter and relatively well-performing exports, the EU milk market would still be in a state of complete chaos.

Given the fact that, with the exception of Canada, the dairy and cheese making industry in virtually every country on this planet is fully exposed to the world market, there is even more to take into account for a better overall view on the market situation in the US, milk production is set to reach 217.3 bn pounds this year [USDA]. And there is already 1.3 bn pounds of cheese and another 260 m pounds of non-fat dry milk in storage. But, contrary to the EU, consumer demand for yogurt, butter and cheese is significantly on the rise in th US. And the US dairy and cheese making industry is now exporting about 15% of total milk supply. This year will surely see over one billion pounds of NFDM and over half a billion pounds of cheese being exported from the US.

All in all, the recent market crisis is over, at least that’s what IFCN say. The industry cannot relax, however, as risk management and preparation for the next market cycle comes into the game.

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