European Dairy Market Summary

MADISON - Jul 19/07 - 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 OVERVIEW:  Milk production in Europe continues to edge lower.
In recent days, hot temperatures are being recorded in most areas
which could impact milk output.  Milk handlers state that as of yet,
no significant impact is being realized, but if hot temperatures
persist, this will cause output to decline at a faster pace.  Reports
indicate that milk output in France, Germany, and England is trailing
last year, while production in other countries is holding steady to
slightly higher.  Farmers are busy harvesting grains for winter feed
stocks.  Early reports indicate that yields for grain appear to be
trailing last season.  As far as forages and silage, these feed stocks
are reported to be in better balance with potential need.  Firm prices
and limited supplies continue to be reported for most European dairy
products.  Traders and handlers state that international buyer
interest has slowed for European sourced dairy products.  They
speculate that this slowdown is due to record high prices versus lack
of need.  Limited stocks are available.  Sales that are occurring are
generally for hand to mouth needs and if buyers need immediate stock,
they will be paying higher prices.  The strong Euro against the U.S.
dollar is another factor for firm price quotes at this time.


EASTERN OVERVIEW:  Milk production in Eastern Europe continues to
fluctuate at or near seasonal peak levels.  In recent days, hot
temperatures are being recorded in Eastern Europe which could
accelerate the seasonal decline if high temperatures persist.  Up to
this point, Eastern manufacturers have been busy processing available
milk volumes.  Stocks generated from the various manufacturing
processes are available, although often not at desired levels for both
internal EU and international buyer interest.

0930c steve schneeberger  (608)250-3204

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STAT News Service