Cheeseburger Menu: dairy and onions push costs higher

The Cheeseburger Menu Index continued its recovery through August, driven by a sharp rebound in dairy prices. Tightening milk availability has pushed raw milk and powder prices considerably higher, while the onion market has emerged as another source of upward pressure.The Index reached 107.58 in week 35, up 1.1% week-on-week and 1.9% over the past month. The Milkshake Index recorded by far the strongest movement, increasing 4.2% this week to 103.88 and bringing its gain over the past month to 21.3%. The Cheeseburger Index moved slightly higher, rising 0.6% to 110.04, but remained 1.3% below its level at the end of July. Meanwhile, the Fries Index was broadly unchanged at 95.59, up just 0.6% over the month.Dairy market: tighter supply pushes prices higher Dairy markets strengthened considerably through August, led by a sharp increase in raw milk prices as the seasonal decline in milk collections tightened availability. The DCA benchmark for raw milk in the Netherlands reached €46.50 per 100 kg in week 36, up 25.7% over the past month. The increase was even stronger in Germany, with Southern Germany rising 28.8% to €47 per 100 kg and Northern Germany climbing 43.5% to €49.50. These spot prices are now above the prices paid to dairy farmers under supply contracts.At the same time, stronger dairy commodity prices are providing further support to the liquid market and vice-versa. SMP continued its sharp upward trend, increasing 5.1% this week to €3,230 per ton, its highest level since 2022, and bringing its monthly gain to 12.7%. The market has been supported by limited producer offers, renewed buying following the summer holiday period and tighter European stocks given solid export demand. With Europe and the US also moving towards their seasonal lows in milk collections, expectations for additional powder availability remain limited.Cheese prices strengthened alongside the broader dairy market, with DCA Mild Cheddar increasing 6.9% over the past month to €3,660 per ton.Onion market: size dynamics and export demand lift prices Onion prices have also increased sharply in recent weeks, with tighter availability of larger sizes becoming an important driver. DCA Packed Onion Benchmark Prices for 30–50 mm onions reached €29.50 per 100 kg in week 36, up 31.1% over the past month. Medium-sized onions increased 40% to €35 per 100 kg, while 60–80 mm onions rose 42.3% to €37 and jumbo onions were up 43.6% to €39.50 per 100 kg.Drought and several heatwaves during the growing season reduced the time available for crop growth, resulting in fewer large onions than in a normal year. While initial yield indications have improved and the overall harvest may be better than previously feared, the size distribution remains an important constraint. At the same time, export demand has strengthened following the reopening of the Senegalese market, alongside broader buying interest from Africa, Asia and Brazil.