Prices at Record Levels Worldwide

price rise

price rise Today prices are at record levels for Cheddar, Mozzarella, Emmental and Gouda. Cheddar curd is trading at €4700-4800/ton, Mozzarella is €4100-4150/ton, Emmental is €4800-4900/ton and Gouda is €4300-4350/ton. Butter prices are also at €5700-5800/ton which is approaching the level we last saw in 2016 with the €7000/ton mark breached. It may not be too long before we see that level reached again due to the fundamental supply shortage throughout Europe. Milk supplies remain very tight with no end to the madness in the short term.

At the moment the European consumer is not seeing the full effects of the price increases, but these will inevitably be passed on by retailers from Q2. Consumers are already under extreme pressure in the post covid economy with hyper inflation rampant everywhere affecting energy, rent and general cost of living expenses. The higher cost of groceries will not go down well with the public. It is in times of extreme price increases where consumers may begin to reduce the amount of dairy they eat but without cutting it from their diets completely.

Increased export demand has also kept the demand side for the European dairy market buoyant. The EU remains the world’s largest dairy exporting region with all the major players looking to increase their market share against competitors such as New Zealand and the US.

An interesting article by The Guardian on the rising cheese prices in New Zealand sheds light on the impact to the consumer. Prices of Cheddar in retail have increased dramatically to over $20 per block in some stores. One consumer referred to their new method of extracting maximum value from their block ‘We started using the really small side of the grater- it’s amazing how far it goes now’. The steep rise in the prices has bewildered consumers in New Zealand who are noted for their love of cheese. Even a standard block of mild which is the noted budget option for shoppers has gone above the $11 price mark. Jon Duffy of Consumer NZ outlined the problem for consumers if prices for standard NZ produced cheese has reached premium prices of imported European cheese ‘We’re not talking about fine imported French Brie here – we’re talking about stock standard kiwi edam, Colby and tasty. If that’s been priced out of the reach of a significant sector of society, then we have a real problem’. In the report rising inflation is the main reason attributed to the increase of food and dairy pricing. It’s only a matter of time before the same issues are experienced by European shoppers.

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