A fire broke out on 31st December 2023 at the dairy raw materials storage unit in the Algerian municipality of Bourguiga (south of Tipasa), which belongs to the National Interprofessional Office for Milk and Dairy Products (ONIL). The warehouse contains approximately 10,000 – 12,000 tonnes of milk powder, according to several market sources. The exact volume of product lost remains unclear until the damage has been fully evaluated.
There is also uncertainty as to how the fire may impact the milk powder market moving forward. Some market participants anticipate that ONIL will return to the market imminently to cover the lost volumes and ensure supply security for the Ramadan period from 10th March to 10th April 2024. Other market participants expect that the volumes ONIL covered with the last two tenders during November and December 2024 should secure adequate stock levels for Q1 2024.
One Market source commented, “This fire could impact the EU market significantly. Algeria is the biggest trade partner for the EU for Milk powders, and ONIL tenders continue to be a key indicator of Algerian domestic demand. If significant volumes were lost this could add upwards potential to the EU SMP market.”
Mintec will continue to follow this topic closely over the coming weeks.
