IFE is optimistic about prices
Prices on the spot market and for bulk butter and skimmed milk powder have been listed higher every week since mid-May, according to a recent analysis of the milk market by Erhard Richarts and Holger D. Thiele at the German Institute of Food Economics in Kiel (IFE).
The calculated prices for butter and skimmed milk powder for the Kieler Commodity Value Milk (4.0% fat and 3.4% protein from the farm) reached almost 25 cents/kg at the end of June, after being just under 20 cents/kilogram in March and April. On the spot market, the price has improved from 16 cents in mid-April to 27 cents in the same time frame. Prices for standard cheese are also moving upwards.
The retail packaged butter price is expected to follow the block butter prices upwards.
For drinking milk and its by-products, which are sold as private label, it will take longer time to move, since the current contracts in Germany mainly run until October.
The German companies listed on several exchanges show futures prices for butter and milk powder to reach close to 28 to 30 cents per kilo of milk. This runs approximately in sync with the trends in the world market.
