Once again, dairy markets are holding firm this week, despite more people talking down the market.

The recent Rabobank report on the dairy market suggested headwinds ahead with tariffs and geopolitical events, but the market hasn’t bought into that yet.

Equally, some of the Irish dairy co-ops that cut milk price referenced reduced market returns as a reason for the cut, but it’s hard to see where markets have fallen over the last month that would warrant a milk price cut.

For example, European butter prices have increased by €260/t over the last month, despite butter dropping in price by €15/t this week.

Whole milk powder (WMP) increased by €25/t this week, while skim milk powder (SMP) went down by €5/t and cheddar cheese went down by €20/t.

This week’s Global Dairy Trade (GDT) dropped for the third consecutive time, by 1% meaning it has fallen by 3.5% in the last three auctions.

At this week’s auction, the main price drop was for powders, with WMP dropping by 2.1% and SMP dropping by 1.3%.

It was better news for butter and cheese, with butter increasing by 1.4% and cheddar prices increasing by 5.1%, which is a fair jump.

Cheese is obviously a big part of the output from Ireland so a bounce will be noteworthy.

Once again, the quantity traded at the GDT was small, with just under 16,000t traded at this auction, reflecting the off-season in New Zealand. The next couple of months will tell a lot about the future direction of milk price, but, for now, markets are stable.