MADISON - Feb 16/12 - 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: Winter has arrived in Europe. During the past two weeks, very low temperatures have been reported in many Western European cities and regions. Temperatures dipped to very low levels, often lower than usual, but not as low as areas of Eastern Europe where temperatures reached record lows. In Western Europe, milk producers and handlers report that the cold temperatures did impact the milk flow, but many feel that the season is so new, that this situation should have limited negative impact on overall milk output. Milk producers, especially those that are closely monitoring their milk output due to quota limitations, are stating that the cold snap may slow the momentum that was developing for the new season and should help with overages in countries such as Austria, Denmark, Germany, and possibly Ireland. Producers in these countries have about 6 weeks left to monitor and manage their milk sales before the March 31 quota year end arrives. Winter conditions continue, but warmer temps are being reported. A new Intervention and PSA year will soon begin. As of March 1, Intervention will open. No product cleared to the program last year, but approximately 43,000 MT of skim milk powder are still in intervention possession, but the powder has been committed to the Most Deprived Persons Feeding Program for distribution. A significant portion of intervention skim milk powder has already cleared to this program with the balance of the holdings scheduled to clear within the new intervention year. Again, traders and handlers are not expecting any significant, if any, volume of skim to clear during the upcoming open season. Also on March 1, PSA for butter will open. This program will remain open until August 15, at which time, butter offered to the program can be withdrawn. The contractual storage period for the butter is 90 - 210 days, depending on the time the butter entered the program. Fixed cost storage aid per ton will be 14.88 Euros per ton and per day contractual storage aid per ton will be 0.26 Euros per ton. Both of these aids have been reduced from last year. Traders and handlers are reporting that sales activity is slow. Many are attributing this trend to weaker prices and buyers are standing back from the market place when possible until the market situation stabilizes. EASTERN OVERVIEW: Cold/winter weather conditions prevailed over much of Eastern Europe during the past two week. Milk producers and handlers report that a negative impact on milk production will be little felt as overall milk output in this region was already at seasonally low levels. For those producers that were starting to realize output increases, the winter conditions slowed development. Traders and handlers report that sales activity has slowed. Buyers are cautious with their purchases as prices adjust, often lower. Stocks of previous year production continue to be available for immediate or near term shipment. 0930c steve Schneeberger (608)278-4154
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STAT News Service
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