Slowly, Surely, European Union Milk Powder Stocks Sold Off
The mountain of milk powder stocks being held by the European Union (EU) is slowly eroding, with stocks now half of what they were when the program was created in 2015, reports the United Kingdom’s Farmers Weekly newspaper.
The EU is reporting that is has 190,000 metric tons of milk powder left in storage, down from 380,000 metric tons at its peak. The program was originally put in place to buy up excess dairy products created after the EU abandoned its dairy quota program.
The EU has been selling off limited amounts of powder each month to prevent a collapse in prices. For example, it tendered 30,000 metric tons last week. At its current rate of sales, the surplus stock of milk powder could be eliminated by the middle of 2019.
Until that time, barring a collapse in milk production, powder prices aren’t expected to strengthen. At the Global Dairy Trade Auction held November 6, skim milk prices were trading at just 91¢/lb. U.S. prices are even lower, trading at 86¢/lb this week.