Following several quieter weeks of limited domestic and low international buying interest on the milk powder markets, increased buying interest was reported from northern Africa, the Middle East, and southeast Asia, leading to prices trending higher during the week. This price action was supported by Algeria’s largest private buyer, Soummam, returning to the market with a milk powder tender for a combined 12.5k mt, 5,000mt skimmed milk powder (SMP) and 7,500mt whole milk powder (WMP). The tender will close on 13th April and delivery is expected to start from June onwards. Soummam has limited the origins of this tender and accepted origins for SMP are Belgium, the Netherlands, France, the US, and Lithuania. The initial bids for SMP are reported around €2,450/mt CFR Algeria. For WMP, accepted origins are New Zealand, the Netherlands, France, the US, and Ireland.
It remains to be seen how the tender will impact other international buyers, while some traders are already anticipating further international tenders over the coming weeks. Other traders more cautious, as recent weak demand has led to increasing stock for milk powders across key exporting regions and the upcoming milk flush in both Europe and the US will likely add further supply to the market, according to participants. This indicates that the milk powder market lacks direction, with one source commenting, “we have largely closed our short financial positions and are targeting to work with more balanced books during the coming weeks.”
