European Dairy Market Summary

MADISON - Feb 28/08 - 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 continues to grow seasonally in
Europe toward the spring peak.  Relatively mild winter weather and
limited snow amounts are not putting undue pressure on cows.  Milk
receipts in Germany and France continue well above year ago levels.
The weak U.S. dollar is causing some adjustments to prices reported.
Current international interest remains fairly quiet.  Skim milk prices
continue under pressure from the lower priced U.S. offerings.  Skim
prices have been stronger and weaker already in 2008.  Whey prices are
also lower.  Butter is also showing weakness as the scheduled opening
of private storage nears in March.  Butteroil is fully steady though
buyers still are able to source supplies cheaper in the world.  Whole
milk powder is steady to firm as uncommitted supplies are limited
elsewhere.  Even cheese has been under some price pressure in Europe.
 The decision on whether or not to increase the milk quotas in the EU
by 2 percent is expected around mid-March.  Due to continued drought
in New Zealand, exporters in Europe are hopeful for additional
international interest.  The Euro continues to set new record highs
versus the U.S. dollar.

EASTERN OVERVIEW:  Milk production continues to lag Western Europe
levels.  Some product is available for export with sellers trying to
clear inventory out before the new production season begins.
Manufacturing is seasonally light and geared toward consumer products.

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STAT News Service