August 2, 2008

EU dairy milk market slows

The European milk production season continues to decline, a USDA report on the dairy situation in the region said.

However, heavier milk volumes reported and sufficient rainfalls providing lush green pastures are giving cause for optimism.

In most instances, manufacturing plants are running as projected, with some indicating that output has been stronger than anticipated. 

Manufacturers and handlers state that stocks of basically all types of manufactured dairy products are available for domestic and international buyer interest but sales activity has been slow, leading to an easing of prices.

As of July 20, offerings to PSA during the current open season total 131,554 tonnes  versus 100,639 tonnes last year at this time.

The current open season will close at the end of August at which time, holdings that have been held for at least six months may be removed.

The situation is the same in eastern Europe, with overall favorable weather conditions there uplifting a gradual decline.  Some milk handlers indicate that August is often a month where warm temperatures and high humidity negatively impact milk output. 

Sales activity, similar to the rest of Europe, has been slow.