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UK Wholesale Prices
Published 26 July 10
UK Wholesale Prices
- With the exception of Cheddar prices, UK commodity prices fell between June and July.
- Prices in the UK are well above last year's equivalents.
With an increase of 4.3% in UK milk deliveries in June, following an uplift of 3.2% in May, milk output may now have turned a corner after declining almost continuously for the past six years. However, the recent hot and often dry weather has accelerated the decline from peak output so it is difficult to say whether this situation will continue into the autumn.
In line with Continental trends, UK commodity prices have been mainly dull over the past month with butter quotations largely unchanged, bulk wholesale cream returns very volatile on a week to week basis and powder markets moving down rather than ahead. There are still strong possibilities that butter and cream prices will be firmer after the holiday period comes to an end and demand revives but, other than through higher exports, market commentators think that powder markets seem likely to remain less attractive.
Resistance to higher prices is still evident in the UK Cheddar market but small increases are still creeping through - for example for 5kg blocks which have tended to lag behind the prices for 20kg blocks. Milk use for Cheddar (in England & Wales) has tended to drop back a little over the past three months and this is helping to keep stocks under control.
|
£ per tonne |
JULY 2010 |
1 month before |
12 months before |
|
Butter (Unsalted) |
3,300 |
3,350 |
2,075 |
|
SMP |
1,950 |
2,000 |
1,450 |
|
Mild Cheddar |
2,800 |
2,800 |
2,500 |
|
Mature Cheddar |
3,050 |
3,050 |
2,950 |
|
Bulk Cream |
1,430 |
1,550 |
950 |
|
See text above and notes below graphs |
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Source: DIN Consultancy |
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Notes: The bulk cream wholesale price is based on an ex-dairy spot price for cream at 40% butterfat, for export. Butter and cheese prices are also based on spot prices and relate to larger quantities of a container or more on a delivered price basis. Larger contracts may be made on a lower price basis. The SMP price is based on spot and longer term contract prices. Prices were derived from talking to traders and milk processors during the period 22-23 July. The published prices will not necessarily match the actual price received by a milk processor as this will depend, amongst other things, on the proportion of product that is sold on the spot market and the proportion sold under longer term contracts and at what price this is done.