There was a steep drop in offers of skimmed milk powder (SMP) into the public intervention measure for the week ending August 21, figures from the European Milk Market Observatory (MMO) show.
In total last week, EU Member States offered 953t of SMP to the measure, one of the smallest amounts of product offered to date.
Just two countries, France and Lithuania, offered SMP to intervention, bringing the total amount of product in the measure to 254,846t.
Meanwhile, offers of butter to private storage aid (PSA) continue to hold steady, with 2,642t of butter offered to the measure last week.
Ireland offered 189t of butter to PSA, bringing the total amount of Irish butter in the measure to 6,809t. To date, 128,131t of butter has been offered to PSA by Member States.
'Global dairy prices expected to lift further in the coming months'
Meanwhile, following last week's bumper Global Dairy Trade auction, New Zealand bank ASB expects dairy prices to consolidate over the next month or so, before lifting further again over the remainder of 2016.
Dairy product prices rose 12.7% at the latest auction, with whole milk powder (WMP) prices a key driver in the rise with an increase of 18.9%.
Rural Economist with ASB, Nathan Penny, has said that after a prolonged slump, global dairy prices have corrected higher.
“We expect the auction price lift over August will be sustained and built upon over the remainder of the season."
The dairy cycle. The hog cycle. Supply correction. Behavioural change. Whatever you call it, it is here, and dairy markets have pushed dairy prices higher as a result.
"Overall dairy prices were very strong overnight, with the 12.7% overall lift the largest since September 2015. The bounce was broad-based, with all product prices rising.
"On top of whole milk powder’s (WMP) surge, butter and butter milk powder prices bounced 18.1% and 14.1%, respectively. Meanwhile, skim milk powder (SMP) rose a modest 3.0%."
From here, ASB expects prices to consolidate over the next month or so, before lifting further again over the remainder of 2016.