Report 31 – Released on August 5, 2021

WESTERN EUROPEAN OVERVIEW:

After a slow start to the 2021 European milk season, strong Q2 milk production pushed YTDmilk levels above those of the previous year. Industry contacts say milk production in Mayand June helped manufacturers catch up on dairy processing needs. Much of the milk movedtoward cheese production as opposed to milk powder/butter production. However, preliminaryestimates of milk production in Germany, France and the Netherlands suggest July weeklycollections are once again lagging behind collections from the previous year. Industryanalysts forecast milk collections in the UK, Ireland and Italy to stay ahead of collectionsfrom last year for the next few months.

The devasting floods that hit Western Germany, Benelux and some of the surrounding areas afew weeks ago disrupted milk and cream collection and distribution. Several processingfacilities had to alter processing schedules. With roads and streets flooded and damaged,some cream and milk was not able to get processed readily and had to be discounted heavilyto find a home for processing. Industry contacts report that milk and cream prices arereturning to normal.

Industry contacts describe dairy ingredient markets as quiet. With many Europeans on summerholiday, the level of sales activity is subdued, especially for SMP and dry whey. Dairymarketers are anxious to see how markets respond to increased activity once summer holidaysend. They are also hopeful that market uncertainty caused by COVID concerns can subside, andchallenges tied to shipping congestion and cost can ease.

EU milk production January – May 2021, 61,895,280 MT, increased 0.4 percent from January –May 2021 according to Eurostat data reported by Eucolait. May 2021 milk production increased1.6 percent from May 2020. Among some of the leading Western European milk producingcountries the milk production percentage change for January – May 2021 compared withJanuary – May 2020, and the May 2021 YOY percentage change are Germany, -1.1 percent,unchanged; France, -1.2 percent, +2.6 percent; Italy, +2.8 percent, +2.1 percent;Netherlands -1.0 percent, unchanged; Ireland +8.7 percent, +6.1 percent.

EASTERN EUROPEAN OVERVIEW:

Milk production gains are supporting the growth of dairy product production in a few leadingEastern European countries. Much of the milk is getting processed into cheese and otherdairy products for domestic consumption. However, the export capacities of these countriesare growing.

For Eastern EU27 countries, according to Eurostat data reported by Eucolait, January – May2021 milk production in Poland was 5,309,540 MT, up 1.1 percent from January – May 2020. May production, 1,127,620 MT, is up 1.5 percent from May 2020.

January – June 2021 milk production in Ukraine, 4.319 million tons, decreased 5.6 percentfrom January – June 2020 according to CLAL data made available to USDA.

January – June 2021 milk deliveries in Belarus, 3.912 million tons, increased 1.4 percentfrom January – June 2020 according to CLAL data made available to USDA.

     Information for the period July 26 -  August 6, 2021, issued biweekly

     Published by:
     Dairy Market News - Madison, WI
     MIKE BANDLI, (608)422-8592
     Email: mike.bandli@usda.gov

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