Milk Market: Prices at their Peak? Market Analysis from 20 September 2024
Protein concentrates slightly declining, skimmed milk powder stable, milk fat, spot milk, and cheese rising – Swiss cheese remains a problem!
Review and Current Situation
The price increase for milk fat continues, while proteins are stagnating and showing a slight tendency to weaken.
The GDT auction on 17 September 2024 recorded an increase of 0.8%. A lively result for whole milk powder (+1.5%) provided a solid foundation, while skimmed milk powder (+2.2%), cheddar (+2.9%), and mozzarella (+4.5%) accounted for the largest part of the increase. Lactose also performed well with a rise of 3.5%. Surprisingly weak results for fat products – butter (-1.7%) and AMF (-1.2%) – however, slowed the momentum of the auction.
Situation in Switzerland
Switzerland continues to head towards a crisis. The butter surplus is growing, and the slow political processes keep milk prices high, weakening sales. Additionally, the strong Swiss franc complicates exports.
At the same time, cheap Swiss skimmed cheese is flooding the market. Often of low quality, watery, and low in protein, this cheese is neither suitable for mozzarella nor for grating.
At the extraordinary general meeting of the fourth-largest dairy company HOCHDORF Holding AG on 18 September 2024, shareholders approved the sale of the subsidiary HOCHDORF Swiss Nutrition AG (HSN). Simultaneously, the company was delisted from the stock exchange and the board of directors was reduced. The decision on who will buy HSN rests with the management, whose preferences clearly lie with the offer from AS Equity Partners. It remains to be seen how creditors and shareholders will react. It is speculated that Newlat may appeal to the courts to prevent the deal. The situation remains intriguing.
Prices at their Peak?
Certainly, this is the case in Switzerland. In Europe milk fat prices will continue to rise. It is still unclear how much this week's floods will reduce milk production, making it difficult to predict the increase.
Forecast for Q4 2024 and Q1 2025
Q4 2024
- Rising milk fat prices.
- Moderate increases in protein prices.
Q1 2025
- High prices due to limited production increases and low inventory levels.
- No price reductions expected before March 2025.
We will be present at the following trade fairs:
- Sial, Paris, 19–23 October 2024, stand 7 B 002
- Marca, Bologna, 15–16 January 2025
- Winter Fancy Food, Las Vegas, 19–21 January 2025, with our partner World's Best Cheese
- Sirha, Lyon, 23–27 January 2025
- Tutto Food, Milan, 5–8 May 2025
- PLMA, Amsterdam, 20 & 21 May 2025
- International Cheese Awards 2025
- Summer Fancy Food, New York, 29 June – 1 July 2024, with our partner World's Best Cheese
- Le Mondial du Fromage et Produits Laitiers, Tours (France), 14–16 September 2025
Best Wishes, Affineur Walo
