Monthly newsletter on the latest developments in the cheese market. (Prices of cheese, milk, butter)

By Walo von Mühlenen          

In recent weeks, discussions have centered around foot-and-mouth disease in Germany. Fortunately, the feared price drop did not materialize; instead, we are seeing a slight increase in cheese prices. This suggests that the crisis has been overcome without significant damage. However, skimmed milk powder and milk fat have shown a slight decline—an indication that production may have increased as a result of the outbreak. We expect this trend to put pressure on the market in the coming days. However, with increased cheese production, the price of milk fat could rebound.

Market Situation in Switzerland

The situation in Switzerland remains tense. High milk prices and the strong currency are putting pressure on exports, while high fat prices in the EU are driving down protein prices, making the export of skimmed milk powder and protein concentrates even more challenging. A reassessment of pricing and production strategies is needed, as these are largely influenced by political factors.

Price Rally in Sight?

Back in autumn, we predicted rising prices in Europe. Although December saw a decline and January was impacted by the outbreak of foot-and-mouth disease, by the end of January, prices had returned to November levels. All indicators point to a positive trend. It is highly likely that prices will continue to rise in the coming months, validating our forecast.

Outlook for Q1 and Q2 2025

• Q1 2025: Rising prices
• Q2 2025: Stock levels are currently low enough that we do not expect any price declines in Q2 either.

The MAGA policies of the USA, which impose punitive tariffs on unfavourable countries, could at any time impact the dairy market, leading to unexpected disruptions.