- Dairy prices across all three markets have hit multi-year highs.
- European butter is approaching an 18-year high with no pullback in sight.
- North American butter has rallied only slightly, making it the better choice for buyers.
Dairy’s Rally Powers On
European butter prices climbed 145 EUR/mt last week, marking one of its largest rallies since the pandemic began.
- This could boost the price of other dairy products.
- New Zealand butter and anhydrous milk fat also climbed, while whole milk powder fell for the first time since February, reversing its recent run of strength.
- US dairy rose across the board.
- Major European dairy factories have pre-sold production for the next 2-3 months, which makes it hard to see a decent correction in Europe until the end of Q1’22.
- Any uptick in demand should continue to fuel dairy’s rally, but the Omicron variant could cause problems here.
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