European Dairy Market Summary

MADISON - Mar 27/08 - SNS -- Dairy market conditions in western and eastern Europe were reviewed in the latest report on the sector released by the USDA today.

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WESTERN AND EASTERN EUROPE

WESTERN OVERVIEW:  The European Union agriculture ministers on March
17 approved the European Commission's proposal for a 2 percent
increase in milk quotas beginning April 1, 2008 to meet the growing
demand within and outside the EU.  Many in the industry enjoyed a long
holiday weekend, off Friday (March 21) and/or Monday. New
international interest is slow to develop.  Milk receipts remain very
strong in France; up to 10 percent above year ago levels, with the
Netherlands also up.  Milk receipts in Germany continue above year ago
levels though at a slower rate in March.  Some plants are already
operating at levels normally expected closer to peak spring milk
intakes.  Much of the price changes reflect currency exchange rates as
price movement elsewhere has been limited.  Most recent production had
been geared toward internal EU consumer products for the holiday.
Cheese, and whole milk powder, are a couple of the other preferred
products to make.  Italian cheese production is affected by dioxin
found in sampled products produced from water buffalo milk, such as
Buffalo milk mozzarella, with a couple Far East countries blocking
imports of the products.


EASTERN OVERVIEW: The new milk production season is still a month or
so off.  Eastern producers tend to lag a few weeks behind those in the
West.  Producers are optimistic about the new season.  Inventories
from last season continue to be whittled down in preparation for the
new production.

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STAT News Service