February 2, 2015

EU milk deliveries rise 2.5% while prices dip

Milk deliveries in the European Union increased 2.5% in November 2014 year-on-year.

Deliveries in the first 11 months of 2014 were 5.1% higher year-on-year. However, the EU average farm gate milk price decreased in November 2014 by 2.6% to 34.3 c/kg, a 14% drop year-on-year.

The figures released by the European Commission's Milk Market Observatory also showed that the average price of dairy products generally decreased last month, with the only exceptions being butter (+0.2%) and whey powder (+1.7%).

Exports-wise, there was strong demand for SMP (skim milk powder), condensed milk and butter/butteroil. By October 2014, SMP exports had already outperformed total annual SMP exports in any of the seven preceding years.

Russia remains the main destination for EU butter and cheese exports. Butter exports to Russia are as of November 24% lower year-on-year, and represent 19% of total EU exports, compared to 29% in 2013.

Exports to the United States and Saudi Arabia are increasing, and Algeria is by far the main destination for EU exports of milk powders. China, Indonesia and Egypt are also very large importers of European SMP.