European Dairy Market Summary

MADISON - Jul 31/08 - 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:  The European milk production season continues to
decline, although some milk handlers indicate that milk volumes are
heavier at this time versus last year.  Rainfall has been prevalent in
most areas, thus pastures are lush and green.  Some milk handlers
state that this is probably what is keeping milk volumes positive on
the downside of the season.  In most instances, manufacturing plants
are running as projected, with some indicating that output is stronger
than anticipated.  Manufacturers and handlers state that stocks of
basically all types of manufactured dairy products are available for
domestic and international buyer interest.  Most traders and handlers
report that sales activity is slow on all fronts.  For most products,
prices are easing due to lighter than anticipated demand.  Butter
continues to clear to PSA.  As of July 20, offerings to PSA during the
current open season total 131,554 MT versus 100,639 MT last year at
this time.  The current open season will close at the end of August at
which time, holdings that have been held for at least six months, may
be removed.


EASTERN OVERVIEW:  Milk production in Eastern Europe continues to
decline, but overall favorable weather conditions are enhancing a
gradual decline.  Some milk handlers indicate that August is often a
month where warm temperatures and high humidity negatively impact milk
output, thus the milk flow could quickly decrease.  Manufacturers and
handlers indicate that stocks are available for both an internal and
international market.  Buying interest for Eastern European produced
dairy products is slow, thus stocks are readily available for
immediate shipment if needed.

0930C  steve Schneeberger  (608)250-3204

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STAT News Service