W29: Dairy Update

In W29 in the dairy landscape, European Union (EU) milk production is expected to decline by 0.2% in 2023 due to dairy cow evacuation acceleration in the last winter and spring. However, the average milk production for cows in the EU is expected to increase by 0.8%, despite the extreme weather conditions. The EU dairy products' use and consumption are under pressure due to the high production costs, especially for milk powders. Consumers are also looking for cheaper alternatives for butter, cheese, and fresh dairy products such as yogurt and quark. This could lead to a limited increase in butter and cheese production and a 0.7% drop in the fresh dairy product turnover. Butter and skimmed milk powder (SMP) export expectations rose by 2%, while cheese and whey fell by 1%. Furthermore, fermented products are expected to fall by 5%.

Tridge’s analysis indicates that the United Kingdom (UK) indicative average prices for bulk cream, butter, SMP, and mild cheddar registered substantial gains in Jun-23. Bulk cream rose by 9% month-on-month (MoM) to USD 2,094.36/metric ton (mt), unsalted butter increased by 2% MoM to USD 5,151.97/mt, and SMP fell 1% MoM to USD 2,659.91/mt. On the other hand, mild cheddar stayed flat at USD 4,596.74/mt. The dairy commodity prices indicated stable-to-marginal gains over Jun-23. However, significant losses were observed compared to the prices a year ago, with bulk cream down 41% year-on-year (YoY), SMP falling 39% YoY, and butter down 34% YoY. Milk cheddar decreased by 25% YoY. Despite current bearish sentiments in the market, prices have firmed.

Lastly, milk production in the agricultural organizations and peasant (farm) enterprises of the Altai Republic in Russia amounted to 7.09 thousand mt as of July 14. This is 953 mt (16%) more than in the same period in 2022. Milk production was the highest in the districts of Shebalinsky (2.29 thousand mt), Choisky (1.37 thousand mt), Ust-Koksinsky (1.31 thousand mt), Maiminsky (964 mt), Ust-Kansky (836 mt), and Ongudaysky (258 mt). The milk sale volume in the period amounted to 5.62 thousand mt, 569 mt more than the same period in 2022. Most milk was sold by agricultural organizations and peasant farms of Shebalinsky (1.61 thousand mt), Choisky (1.09 thousand mt), Ust-Koksinsky (984 mt), Maiminsky (940 mt), and Ust-Kansky (755 mt) districts. Meanwhile, the average daily milk yield per cow in agricultural organizations and peasant farms in the region amounted to 13.62kg, exceeding the 2022 level by 2.7kg. The highest average daily productivity was registered in Chemalsky (16.67kg), Maiminsky (16.40kg), Shebalinsky (14.23kg), Choisky (12.80kg), Ust-Koksinsky (12.30kg), and Ust-Kansky (12.10kg) districts.