Thursday, 19 March 2020
By Patty Clayton
After months of relative stability, settled values on EU dairy futures have shifted down as the impact of the virus continued to be felt across the industry. Settled values on futures contracts provide a good indicator of how market participants expect prices to move, based on current conditions. The latest drops will reflect the concerns over the impacts of lower demand and rising product availability on dairy product prices.
The forward milk price equivalent (FMPE) value combines settled prices for butter and SMP futures contracts on the EEX exchange. Between Oct 2019 and Feb 2020, the FMPE remained in the region of €35-€39 cents/100kg for contracts expiring April through August.
As coronavirus spread across Europe however, market sentiment shifted, and settled prices fell. In early March, before governments starting restricting social mobility, FMPE fell about 11% to around €34c/100kg. More recently, we have seen a further drop, with FMPE falling to around €30c/100kg for contracts with April through June expiry dates.
Sign up for regular updates
You can subscribe to receive Dairy market news straight to your inbox. Simply fill in your contact details on our online form and select the information you wish to receive.
While AHDB seeks to ensure that the information contained on this webpage is accurate at the time of publication, no warranty is given in respect of the information and data provided. You are responsible for how you use the information. To the maximum extent permitted by law, AHDB accepts no liability for loss, damage or injury howsoever caused or suffered (including that caused by negligence) directly or indirectly in relation to the information or data provided in this publication.