DCA Benchmarks: Powder market commentary week 33

The powder market observed a definite positive development in week 33 (August 13), with all benchmarks increasing over the week, except for lactose and SWP Feed. SMP faced a notable increase in the feed segment, with producers posting increasingly higher prices. Whey powder prices also increased, although at a more moderate pace.In the milk powders segment, SMP increased by 2.1% over the previous week to €2,925 in the food grade. The feed grade SMP increased even further by 2.9% to €2,820, closing slightly the gap with the food segment. WMP faced a more moderate decline, up by 1.1% compared to the previous year to €3,565, and producers requesting prices at around €3,650. This cemented a notable recovery compared to previous month, with WMP rising by 10.2% and SMP between 7% and 7.9%.The whey complex observed a more moderate increase, with SWP Food rising by 1.1% over the previous year to €1,825. In contrast, SWP Feed remained stable at €1,505. Whey powder remains the most resilient commodity in the powder segment, rising from 61.8% to 73% compared to the previous year. Lactose was the only benchmark reporting a decline, falling by 1.9% over the previous year to €1,570, although prices remain resilient compared to the previous year. Contributors link the increase in lactose prices to the limited availability of whey ingredients in filler applications, which have increased the demand for lactose as a replacement. Contributor highlighted the firming powder market, particularly for SMP, although demand remains constrained and export demand was described as present but not overwhelming. Expectations of lower milk collections and drought were noted as factors supporting prices. Lactose was underlined as difficult to sell, while FFMP exports were reported slow amid weaker summer demand.