Market report: Further EU sales of intervention butter

The EU sold 11,935t of butter out of intervention at its second tender of the season last week.

Demand was again high, with bids totalling 39,564t, and a minimum price of €3551/t – €100/t higher than the previous tender. For the second time the Commission rejected all bids for 15,513t of skimmed milk powder, saying that prices were again too low.

Butter supplies in Private Storage Aid stores were well below last year, with just 61,500t offered since 1 March, compared with 96,100t offered last year when prices were much lower. “This may result in tight supplies over next winter,” said DairyCo Datum’s latest report.

Meanwhile, EU milk production in March fell by 99,700t year-on-year, to 11.6m tonnes. That put 2009/10 total milk production at 133m tonnes, 624,000t lower than the previous year.

Average milk prices increased by 7.7% year-on-year, to €28.68/100kg in March, equivalent to 26.63p/litre. UK prices only rose by 0.7% over the same period, forcing the UK down the milk price league table to 19th spot.