Weaker Sterling limits dairy commodity price falls

Q UK dairy commodity prices eased in April, following recent EU trends, but a 2% month-on-month weakening in sterling against the euro moderated the falls.

Bulk butter and cream values dropped by 4.4% and 3.2%, to £3,250/t and £1,500/t, respectively, with cheddar prices remaining generally steady, and skimmed milk powder markets improving marginally, to £2,200/t.

At United Dairy Farmers’ auction last week, 59 million litres of milk was sold for May delivery. Prices averaged 25.85p/litre, 0.81p/litre lower than last month and 0.23p/litre below the record of April 2010.

“Although there were significant falls in world and European powder markets over the past month, some market commentators think that prices may be stabilising,” says the latest report by DairyCo.

“Prices in this month’s auction may have been helped by sterling’s weakness against the euro, which has strengthened Northern Ireland’s competitive position.”

Cheese manufacturing started strongly in 2011, with February production 4.3% up on the year, to 28,900t. Cumulative production in the year to February reached 376,000t – 5.3% up.