European Dairy Market Summary

MADISON - Aug 4/05 - SNS -- Dairy market conditions in western and eastern Europe were reviewed in the latest report on the sector released by the USDA today.

WESTERN AND EASTERN EUROPE

WESTERN EUROPEAN OVERVIEW:  Milk production patterns across Western Europe
continue to be influenced by weather patterns.  Hot/dry conditions in many
areas continue to be reported.  Some areas are nearing drought conditions.  In
these areas, producers are quite concerned about sufficient feed stocks for
upcoming winter needs.  In other areas, some rainfall has occurred, thus
pastures and winter feed potential is in much better shape.  Overall milk
production continues to run slightly ahead of last year, although some areas
are trailing last season at this time.  Many producers state that if adverse
weather conditions do not break soon, production declines could be quite
sharp.  Trading activity within Europe is slow and unaggressive as the summer
holiday/vacation season is occurring.  Most traders and handlers state that
they would anticipate that once September rolls around and the summer vacation
period has ended, international buyer interest might resume.  At this point,
most interest is centered around fourth quarter deliveries, but no significant
sales activity is being reported.  Traders and handlers state that stocks are
available for both internal and international buyer interest with most trading
activity centering around internal needs at this time.  Intervention comes to
a close at the end of the month and producers and handlers do not foresee
much, if any, additional offerings to occur between now and then.


EASTERN EUROPEAN OVERVIEW:  Milk production in Eastern Europe is basically on
the down side of the season.  Up to this point, milk output has been stronger
than last year, but in recent days there are reports of heavier than usual
declines.  Often, Eastern European milk production is influenced to a greater
extent by weather conditions, thus hot and dry conditions could be a major
contributing factor to this trend.  Stocks of manufactured dairy products are
available for internal and international buyer interest.  Traders report that
buyer interest is slow.  Some producers and handlers in Eastern non EU
countries report that buyer interest is occurring.

0930c steve schneeberger  (608)224-5084

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STAT News Service