DCA Benchmarks:Cheese commentary week 23

Pressure on cheese prices is becoming more pronounced. For the second consecutive week, markets are moving lower and market participants expect the downward trend to continue in the coming weeks.Buyers remain cautious, while seasonal cheese availability is increasing. Although there is no sign of oversupply, foil cheese is readily available. Delivery ages are gradually increasing in some cases, although they remain relatively low at certain production sites. Producers are trying to defend current price levels and are still asking up to €3,500 per tonne for Gouda, but bids are being placed at significantly lower levels.The DCA benchmark for Gouda declines by €75 this week to €3,380 per tonne, while Edam is under even greater pressure. Premiums for third-quarter deliveries remain limited, encouraging some buyers to secure volumes for that period already. Despite the current weakness, the market does not anticipate any major price corrections in the coming weeks and months. The DCA Mozzarella benchmark also declines, falling by €80 to €3,465 per tonne. Spot availability remains limited, although product for forward delivery is more readily available. Market sources indicate that mozzarella production volumes are currently relatively high. Prices remain above Gouda and Edam levels, but this premium is expected to disappear later this summer.While mozzarella remains relatively expensive compared with Gouda, cheddar is comparatively attractively priced. The DCA Cheddar Curd benchmark declines by €65 to €3,365 per tonne, while Mild Cheddar falls by €60 to €3,415 per tonne. Processed cheese manufacturers report that they are occasionally increasing cheddar usage in formulations at the expense of Gouda due to favourable economics. Product availability from Ireland and the United Kingdom is relatively abundant, although this is not unusual for the time of year. The DCA benchmark for Emmentaler remains unchanged at €3,875 per tonne. The market appears balanced overall, although cheese destined for grating applications is experiencing some pressure. Natural cheese markets remain relatively stable for now, but market participants expect downward pressure to emerge here as well over time.