European Dairy Market Summary

MADISON - Mar 15/12 - 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:
Weather conditions in Western Europe are more spring like than late
winter.  Outside of the cold snap throughout Europe a month or so ago,
the winter season has been quite mild.  Milk producers and handlers
are stating that noticeable production increases are occurring ahead
of typical trends.  The milk quota year has another two weeks to go
before the March 31 end.  At this point, there are two countries that
will probably be over quota (Germany and Austria) with other countries
on the border line (Denmark, the Netherlands, Ireland, and Italy).  At
this point, increasing milk volumes are being handled with minimal
problems and milk is clearing to most all products at low seasonal
levels.  No particular product is getting a stronger milk volume tilt
than another.  Intervention and PSA for butter opened on March 1.  No
butter or skim milk powder stocks have cleared to intervention and
most within the industry feel that neither of these two products will
clear unless commercial pricing declines during the open season (March
- August).  No official volume figures have been released at this
time, but producers and handlers indicate that butter volumes are
clearing to PSA.  Butter producers and handlers are speculating that
total PSA volumes will be comparable to last season.   Manufacturers
and handlers of dairy products are indicating that overall demand is
limited to domestic or internal markets.  International buyer interest
is slow.  Traders and handlers are hopeful that buyer interest will
resume as European milk production increases seasonally and product is
more available to potential buyers.  Overall, prices are trending
lower with traders and handlers unsure as to how far current prices
might trend.

EASTERN OVERVIEW:  Signs of seasonal milk production increases
continue to be reported.  Although cool, temperatures have increased
considerably from record low levels of a few weeks ago.  Milk
producers and handlers are reporting that milk volumes remain at or
near seasonal low levels, but reports of increases are occurring each
week.  Stocks of manufactured dairy products are limited, but traders
and handlers are hopeful that international buyer interest will resume
as milk volumes and finished product volumes increase.


9:30c steve schneeberger   608-278-4154

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STAT News Service