Dairy Market: When will Switzerland collapse? Market analysis dated 22 March 2024
Spot milk price is strongly declining, as are the prices for cheese, skimmed milk powder, and milk fat, while protein concentrates, and feed costs remain stable.
Following a 2.8% price drop at the GDT auction on 19 March, a downward trend is also emerging in the EU. Almost all prices have been falling for two weeks, and the significant decrease in the spot milk price suggests an oversupply of milk. It is hoped that cheese manufacturers in Europe will maintain their composure. Currently, there are signs of agitation particularly among Eastern European producers.
And in Switzerland?
The C-milk price as of March is rising, and in July 2024, the milk prices are set to increase by 4%. The only glimmer of hope is the exchange rate.
The question arises: When will Switzerland collapse?
The dairy industry is increasingly approaching the brink. If the spot milk prices of €0.355, which are common in Germany, were to be uniformly adopted, the Swiss dairy economy would definitely face a crash. Even a mere price reduction of 5% could cause serious difficulties. To smoothly implement the planned price increase in July 2024, a rise in prices within the EU of 6% to 8% would be required.
Our forecast for Q2 and Q3:
Our expectations for the second quarter were more positive; however, falling prices ranging from 3% to 5% appear likely. Nonetheless, we still believe that a recovery in prices will occur in the third quarter, potentially leading to an increase of 2% to 3%, but not in the range of 6% to 8%.
We will be showcasing at the following expos:
• Cibus Parma, from 7 to 10 May 2024
• PLMA Amsterdam, on 28 and 29 May 2024
• Summer Fancy Food New York, from 23 to 24 June 2024, in partnership with World's Best Cheese
• International Cheese Award, on 27 June 2024
• Sial Paris, from 19 to 23 October 2024, where we'll have our own booth
• Marca Bologna, from 15 to 16 January 2025
• Winter Fancy Food Show Las Vegas, from 19 to 21 January 2025, along with World's Best Cheese
• Sirha Lyon, from 23 to 27 January 2025
• Le Mondial du Fromage et des Produits Laitiers in Tours (France), from 14 to 16 September 2025
Best Wishes, Affineur Walo
