Cream continues to be volatile market in UK
This year the holiday affect has still taken place to some degree, however, ongoing tight supplies and fluctuating exchange rates have been influencing price movements to a greater amount.
Cream continues to be a volatile market. Prices ranged between £2,420 and £2,600/tonne in July.
As well as this, the panel surveyed experienced a mixed position in terms of trade, with some seeing good volumes traded and others not.
This could be down to different specification requirements, urgency of purchase and maybe even location.
In general, prices followed on from June before falling back in the second week. However, in the latter stages of the month, prices rose again as activity increased.
On average, butter continued to rise in July. However, similar to cream, there was some easing around the second week of the month but prices quickly bounced back.
Average butter prices have been rising sharply month on month, with prices up 15% and 19% between May/April and June/May respectively.
In July though, prices increased a modest 6%. Holiday season and exchange rate changes were attributed to the movements over the month.
The rise SMP prices saw in June was pretty much reversed in July, as the average price fell to £1,570/tonne.
Exchange rates had the biggest influence on the powder market, as prices in the latter stages of the month fell back towards around €50/tonne above the intervention level.
Prices for cheddar stabilised through the month as buyers seemed to back away slightly unless they needed stock.
There appears to be some substitution beginning to take place, partially between different products but also between different maturities. On average though, prices increased marginally between June and July. ■