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WORLD PRICE TRENDS FOR DRY SKIMMED MILK STAY FAVORABLE : News archive
02 March 2007
At the beginning of the second half of year 2006 several factors influenced increase in price for dairy products in the world markets. Firstly, three spells of drought that struck USA and then Australia (exporting countries number three and four, controlling fourth part of the world dairy export) resulted in abrupt decrease in production (and corresponding reduction of the export offer) of dairy products from these countries. Secondly, decrease in export incentives caused by the CAP policy pursued for the last several years in the EU countries (traditionally the region supplying roughly one-third of the world’s dairy exports) led the EU countries focusing on domestic dairy trade and, consequently, to the reduction of exports to the world market from these countries.
As a result, at the end of 2006 world dairy price index reached record-breaking numbers; the dairy proteins (SMP, casein, whey and whey-based concentrates) played the defining role in this price increase.
Ukrproduct Group’s experts estimate that the favourable price trends for dairy products are likely to continue at least until mid-2007. In the period March – June, world export prices are likely to exceed average prices for the similar period of the last year. This can be explained by that fact that climatic factor of dairy products pricing, except for component of direct/instant action (graze feeding), has also secondary component – by means of price increase for the fodder. As the countries that suffered from drought – USA and Australia – are also the world’s leading grain producers, a reduction in offer and increase in price for fodder feedstuff is very likely. This can contribute further to the maintenance of high dairy products price in the world markets. |
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