Milk Production
Milk production remains strong in South America
Raw milk production remains strong and steadily improving in South America, thanks mainly to the favorable weather conditions.
Farm gate nominal prices remain relatively high. However, in most cases, dairy farmer operating costs are relatively high due to the negative drought effects to grain crops during Q1.
The milk and cream intakes are in balance with manufacturing needs. The sales of some dairy products, such as cheese, butter and milk caramel, are very active.
The Brazilian dairy industry continues recovering from the last trucker strike.
SMP export prices shifted down in South America. Inventories are becoming more available on a weaker market, compared with one month ago.
WMP export prices decreased on moderate trading. Demand for WMP is fair to good throughout the South American continent, but with more condensed whole milk available, WMP processing has been very active, and WMP supplies are steadily building in most processing plants.