ing of skim milk powder (SMP) has continued to ease over recent months. However, as this decline comes on the back of record highs in December 2013, the country’s total SMP imports for the first five months of the year are up almost 90% on the same period in 2013.The EU has benefitted from this growth, with a five-fold increase in export volumes of SMP destined for China between January and April, when compared to the same four months in 2013. While wholesale prices started to decline in this period, the value of SMP exports to China climbed to almost €90million in these four months – up from €16million in 2013.
China’s domestic milk supply is now reported to have stabilised following a drop in production in the latter part of 2013, which resulted from a combination of factors including disease, high feed prices and industry consolidation. Rabobank expects a period of stable Chinese buying in the second half of 2014 due to a slowdown in local demand growth and a strong stock situation arising from the high level of purchases early in the year.
