Here is John Hallo in our latest edition of the Inside Track, covering the latest movements in global dairy markets. WMP lifted 2% on the GDT, with strong early-season demand from China and North Asia. Butter dipped 3.8% due to increased NZ volumes, while skim and cheese markets remain balanced. Protein demand continues to surge, especially in the US, supporting bullish WPC and WPI trends. Plus, don’t miss Maxum Foods at Fine Food Sydney 8th-11th September.
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Hello and welcome to Maxum Foods Inside Track. Can you believe it, August already. Let’s have a look at what’s happening in the dairy industry.
Starting off with whole milk powder, so futures market had predicted an uptick last night and the GDT did deliver there in real terms up 2% on whole milk. C2 in particular was up 4%, so some good solid demand at the start of the NZ season. In terms of the demand profile, it was business as usual with China and North Asia contributing to about 49% of the demand. So it was a good, a reasonable even spread across the global markets. Obviously there’s some good conditions in good milk conditions, especially in the South Island. So there is plenty of milk coming from New Zealand. So it’ll just be a question whether that global demand holds up with some really good strong fundamental supply.
Looking at skim milk powder, not a lot to report on the global stage. Things are reasonably flat from the last fortnight. It was an even result on GDT in EU, things look reasonably balanced as well and the non fat market in the US balanced.
Having a look at butter, so the biggest fundamental shift last night was in butter down 3.8%. We did hear of reasonable inventory in New Zealand from Fonterra, hence putting more on more volume on the platform, which probably led to that bearish result last night. On a global scale, good milk, milk production in the US up for June, July, so probably has attributed to more fat and then more fat on the export market. So that has put a bit of pressure on the global fat market.
Having a look at cheese in on the NZ side of things, as the big processes in New Zealand try to diversify out of whole milk, more cheese and whey production has resulted and yeah, so there seems to be a good supply of international cheese on the market, but demand is holding up, so pricing reasonably balanced. The US once again with that good chunk of milk coming in June, July, you know may result in some more US cheese on the export market. Big question mark as well in terms of trade flows and tariff implications. However, supply seems reasonably good of cheese globally.
Having a look at whey powder and proteins, yeah, still a relatively bullish market on protein. We’ve spoken before of the Ozempic and meal replacements and general protein trend, people getting more protein into their diet globally. This is especially in the US with some good strong domestic demand. So yeah, a lot of a lot of demand domestically in the US, so not as much on the export market. So we’re seeing some bullish conditions in WPC and WPI. Well, thanks very much for listening to today’s Inside Track. Just bear in mind, Fine Food’s down in Sydney at the start of September, so a lot of the Maxum team will be down and around. So we look forward to catching up with anyone who’s there and in the meantime, have a great fortnight.
