Output slashed
Cheddar makers in England and Wales made a determined effort to cut their stocks in October and November by slashing output by up to one third. Latest DEFRA figures show a 20% reduction in milk use for Cheddar in October compared with last year and an even more significant 33% cut in November. The cutback led to the lowest levels of Cheddar production for over a decade.
The cuts have had an impact on oversupply problems, bringing supplies back into a better balance with demand.
Prices for mild Cheddar have been slowly getting firmer since September and the forward position also looks more positive for cheesemakers.
United funding
Dairy bosses at United Milk have secured further funding from the bank.
The co-operative has reached agreement with its bankers on the terms of a financing package, although the deal is subject to approval by United Milk's shareholders.
Chairman Paul Deakin said: "We are delighted to have recieved this additional support from our bank.
"The agreed package will ensure the Westbury factory will play a full role in the UK dairy industry."
Supply problems
An end to drought in Brazil has resulted in supply problems as farmers hold onto cattle to fatten them up, causing daily price rises for processors.
Corned beef prices are stable at the moment but if farmers hold off sending livestock to markets, suppliers will be forced to raise export prices.
Another problem is the strength of the Real currency against the dollar.
Argentina has growing economic problems and devaluation of the peso has resulted in the Real/peso rate being on par.
This has forced production costs higher, and traders fear Argentina will find it harder to compete in the corned beef market.
Pricier hot dogs
New regulations look likely to force higher costs into hot dog production.
The rules mean changes in hot dog formulation and with high sales, importers are concerned that higher prices could impact on promotional activity.
An importer told The Grocer: "Long term, this will be a benefit as consumers are looking for added value, better quality products across the range of canned meats."
{{MARKET EDGE }}
Cheddar makers in England and Wales made a determined effort to cut their stocks in October and November by slashing output by up to one third. Latest DEFRA figures show a 20% reduction in milk use for Cheddar in October compared with last year and an even more significant 33% cut in November. The cutback led to the lowest levels of Cheddar production for over a decade.
The cuts have had an impact on oversupply problems, bringing supplies back into a better balance with demand.
Prices for mild Cheddar have been slowly getting firmer since September and the forward position also looks more positive for cheesemakers.
United funding
Dairy bosses at United Milk have secured further funding from the bank.
The co-operative has reached agreement with its bankers on the terms of a financing package, although the deal is subject to approval by United Milk's shareholders.
Chairman Paul Deakin said: "We are delighted to have recieved this additional support from our bank.
"The agreed package will ensure the Westbury factory will play a full role in the UK dairy industry."
Supply problems
An end to drought in Brazil has resulted in supply problems as farmers hold onto cattle to fatten them up, causing daily price rises for processors.
Corned beef prices are stable at the moment but if farmers hold off sending livestock to markets, suppliers will be forced to raise export prices.
Another problem is the strength of the Real currency against the dollar.
Argentina has growing economic problems and devaluation of the peso has resulted in the Real/peso rate being on par.
This has forced production costs higher, and traders fear Argentina will find it harder to compete in the corned beef market.
Pricier hot dogs
New regulations look likely to force higher costs into hot dog production.
The rules mean changes in hot dog formulation and with high sales, importers are concerned that higher prices could impact on promotional activity.
An importer told The Grocer: "Long term, this will be a benefit as consumers are looking for added value, better quality products across the range of canned meats."
{{MARKET EDGE }}
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