The increase in supply is not a singular event but rather a collective effort across key exporting nations. The report notes that both EU milk and butterfat supplies have eased, while the U.S. is producing an abundance of cheese and butterfat. Additionally, improving milk output in New Zealand is contributing to the overall surplus. This coordinated boost in production has created a highly competitive environment for producers and has led to a weakening of prices for key commodities.

Despite some stable demand, particularly for cheese in the EU, the overall market is showing signs of weakness. Data journalism from the report indicates that both EU cheese and butter exporters are losing market share, a clear sign of the heightened competition. In the U.S., the combination of strong milk and cheese production, coupled with weak domestic demand, is further contributing to the market’s decline. This imbalance between supply and demand is the primary driver of the current downward pressure on prices.

For the international dairy community, these trends highlight the delicate balance of dairy economics. While global trade has expanded, the report points out that there has been a notable resistance to previously high prices. This cautious buyer behavior, evident in recent export trends, suggests that market participants are wary of over-committing in a potentially declining market.