June 2, 2011

British dairy market prices rise despite increment in production

In spite of the seasonal increase in milk output, British dairy commodity prices progressed last month.

April milk output was 4.7% higher than the previous year, with May showing a similar rise, and providing plentiful supplies for commodity manufacture. However, most operators are reporting a tight market, with no build up in stocks or anxious sellers, said DairyCo's latest report. "This has enabled UK commodity prices to edge back up again after dipping during March and early April."

Bulk butter values increased from GBP3,250/tonne (US$5311) in April to GBP3,450/tonne (US$5639) in May, almost reaching February levels. "Butter is expected to remain buoyant over the next few months, with further price increases possible," it said. "Bulk cream prices have increased significantly in recent weeks, with strong export demand helped by the weakness of sterling, and also the early start to the fresh fruit season." Prices jumped from GBP1,500/tonne (US$2452) to GBP1,700/tonne (US$2778) over the month.

Despite strong UK skimmed milk powder output, values have firmed slightly to GBP2,250/tonne (US$3677), with mild cheddar up by the same amount to GBP2,950/tonne (US$4821).