Piling Product Pressures Prices

Another heavy trading day, with all commodities showing softness. Butter traded another 1,000 mt, with Q1 prices dipping to €6,300 for Polish product. For Q4 as low as €6,250 for Irish or Swedish origin, and as low as € 6425 for NL/DE/BE origin.  Prices for H1 2026 moved down to €6,335 for NL/DE/BE product. Cheese offers continue to build, but bids above €3,700 are non-existent, with more buyers eyeing the €3,500 level. In powders, only whey seems to be holding ground. SMP continues to see rising offer-side volumes, but buyers remain disengaged.

Liquids: Trending Lower

Weakness is spreading into the liquid market. SMC remains relatively steady around €2,000–€2,100, but looking at historical spreads between SMC and SMP in August/September, the gap has typically been narrower—indicating slight underlying weakness. Cream is also under pressure compared to last week. On Tuesday, cream still traded above €8,100, but in Eastern Europe and Germany levels slipped below €7,900 by day’s end, with some loads reported at €7,800. Raw milk continues between 46–50 c/kg, depending on the loading point. The softer tone across commodities is clearly reflected in a weaker spot market for liquids as well.

International Downward Prices

Similar patterns are visible in the US. CME prices remain under pressure, particularly butter, which has hit its lowest point in a long time. NFDM and cheese also trend bearish, though less dramatically. A trading partner reported that USD offers for butter into North Africa dropped by more than $500 in just the last two weeks.

The GDT Pulse on Tuesday added no relief either. Both WMP and SMP traded lower compared to the previous Pulse, making it clear that export demand is not going to provide support. Europe will have to find an internal outlet.

Butter: Stocks Are Heavy

Another 1,000 mt traded via our books, but new demand remains scarce while offers keep piling up. Interest for 2025 appears largely covered, leaving only a handful of buyers waiting for lower levels. Interestingly, EEX futures remain in backwardation, while most physical demand we see is focused on 2026. Meanwhile, offers concentrate on September and Q4. We expect it to be a matter of days—or weeks at most—before Q4 trades at a discount to Q1. This shift is already visible: Q4 Irish/Swedish product is moving at €6,250 vs. Q1 bids at €6,300 (with specifications not matching, hence the small gap).

Stocks are increasingly becoming an issue. We are facing difficulties with brokered contracts where goods cannot be transferred in warehouses due to full cold stores. Irish producers are now offering DAP NL/BE/FR for quick shipment to avoid storage constraints. Last year’s short squeeze is being replaced by this years stock squeeze.

Current Offers:

• 12 trucks NL/DE/BE Q4 at €6,450 (bids €6,300)
• 12 trucks NL/DE/BE Q1 at €6,350 (bids €6,300)
• 5 trucks Irish butter Oct/Nov at €6,350 (€6,200 FCA IE)
• 10 trucks Arla SE/DK/IE Sep/Oct at €6,300 FCA NL

Cheese: Offering Lower

No brokered deals so far. Buyers and sellers remain misaligned—like magnets repelling each other. Every time a seller edges closer to buyers’ levels, bids move further down. The gap feels impossible to close. Sellers continue to appear, while new buyers remain absent.

Current Bids:

• 2 trucks Mozzarella DAP NL Sep at €3,700
• 3 trucks Gouda DAP NL Q4 at €3,700

Current Offers:

• 9 trucks Mozzarella Q4 at €3,750
• 12 trucks Gouda Q4 + Q1 at €3,900

Powders: Linda Lacks Liquidity

With Linda back and energised, there was hope the powder market would wake up. Despite her efforts, the market seems content to snooze a little longer. As Linda often asked me, “Why are you bullish?” Looking at today’s tone, it’s hard to recall. Fundamentals are perhaps not as bearish as in butter and cheese, but powders are not immune to shifting supply-demand balance.

Global milk intake is rising quickly, which implies powder production will increase too. The market needs an incentive to absorb these volumes, and for now, the only incentive is lower prices. As reluctant as we are to admit it, if bearish pressure continues in butter and cheese, SMP prices are unlikely to remain untouched.

Final Note

Across all commodities, the tone is undeniably heavy. Stock pressures, weaker international benchmarks, and absent buyers suggest we may only be at the beginning of a broader market correction. Vigilance and patience will be essential in navigating the weeks ahead.