DCA Benchmarks: Proteins commentory week 21

The high-protein dairy market continues to surprise. Despite already elevated price levels, quotations for WPC80 and WPI90 continue to rise, with this week showing an even sharper increase than in previous weeks. This is particularly the case in Northern Europe. Demand for WPC80 remains exceptionally strong, although concerns are increasingly being voiced about the high price levels.As long as this situation persists, the market appears set to move even further upwards. The market for high-grade and concentrated whey proteins continues to expand, although the current pace of price increases may prove difficult to sustain.A comparison with price levels in the United States shows that prices there are now below those in Europe. Including import duties, European WPC80 has certainly become too expensive for the US market at current price levels.Nevertheless, the market here appears largely unfazed.The difference between WPC80 and WPI90 quotations does, however, require further clarification. The current high-protein whey market is primarily centred around WPC80. It is the most sought-after product and also the most attractive to manufacture. Liquidity in this market is the strongest. WPI90, by contrast, is more difficult to produce and faces lower demand. This is one reason why producers manufacture it almost exclusively on request and apply a premium to the price. It is clear, however, that high-protein products other than WPC80 are also performing strongly in the market. This is reflected, for example, in the sharp price increase for WPI70. This product, a by-product of WPI90, contains less protein and significantly more fat. Its price has risen within a matter of months from €14,000–15,000 per tonne to €18,000–19,000 per tonne.Further down the whey value chain, a similar pattern can be observed. Production and demand for WPC35 (and WPC34) continue to decline, yet prices for these products have also increased sharply, alongside standard whey powder.