European Dairy Market Summary

MADISON - May 8/08 - 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 patterns in most parts of Europe
continue to increase, while some areas are probably at peak levels
already.  Typically, milk production will peak out around mid May in
Western Europe.  Most milk handlers state that milk receipts are
building, with some indicating that their receipts have plateaued.
More cows are now on pasture after a cold and wet spring which limited
grazing for many herds.  Pasturing the dairy herd is later this year
than usual, thus milk handlers feel that this will help maintain high
production levels for the foreseeable future.  Manufacturing
facilities are running at or very near capacity levels processing all
of the offerings.  Milk powders and butter operations are the fullest
with cheese makers indicating that they still have room for additional
milk.  Stocks of new manufactured dairy products are fully sufficient
for internal and domestic needs with surplus clearing to inventory.
Surplus butter production continues to clear to PSA.  By mid April, 6
weeks into the current program, volumes already in the program were
nearly double the previous year with butter producers projecting that
weekly offerings continue to run between 6,000 and 7,000 mt per week.
No additional details are available pertaining to the recent dairy
product tender that was finalized in recent weeks.  Skim and whole
milk powder along with some butterfat are reported to be the products
sought in the recent tender.  A portion of the skim milk powder will
be sourced from the U.S. with the balance and majority of the products
reportedly coming from Eastern and Western European sources.


EASTERN OVERVIEW: The new milk production season in Eastern Europe
continues to gain momentum.  Typically, Eastern European milk
production patterns trail their Western counterparts by 4 - 6 weeks.
Although Eastern European output did not experience as strong a
seasonal start as in Western Europe, Eastern milk handlers state that
volumes are increasing on a very steady basis and are on track with
previous years.  Domestic sales of manufactured dairy products are
typical, with international sales slow, except for those that will be
taking part in the recent tender.

0930C  steve Schneeberger  (608)250-3204

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STAT News Service