The global cheese market is experiencing typical seasonal pressures as demand weakens during the summer months, with European prices declining across multiple cheese varieties despite continued steady milk production.

Market activity has remained subdued as many industry players take summer holidays, creating a challenging environment where sellers are eager to move inventory while buyer interest remains limited.

Several European cheese manufacturers are banking on increased buyer activity after the summer break to help clear remaining Q3 volumes. However, uncertainty remains about whether buyers still need to cover their Q3 requirements or have already secured supplies through June purchases and spot market transactions.

Cheddar markets show mixed regional dynamics

European cheddar prices continue to face pressure, with the Vesper Price Index decreasing to €4,430 ($5,125/mt) EXW this week. The decline reflects seasonally strong production combined with slower summer demand.

Despite expectations that European cheddar exports would drop due to significant price advantages for American cheddar in global markets, European exports have actually increased 4.87% year-to-date compared to the previous year.

In the United States, cheese prices on the CME rose quickly early in the week after June ending stocks came in 3% lower than last year, below market expectations. This occurred despite growing US cheese production, which increased 4.19% overall and 8.26% for cheddar specifically in June.

Higher exports are the primary reason for reduced cheddar availability in the United States, with APAC countries purchasing significantly more US cheddar at the expense of EU cheddar due to a substantial $1,200/mt price difference between the regions.

Emmental experiences rapid price decline

Emmental prices have dropped swiftly in recent weeks after remaining relatively stable since late September last year. The Vesper Price Index for emmental decreased to €4,800 ($5,553/mt) EXW, following the pattern seen in other cheese varieties like gouda and mozzarella.

The decline follows the established “six-week delay” rule typically observed in emmental markets, with gouda and mozzarella prices beginning to fall in mid-June and emmental following suit in recent weeks.

European producers have returned to the market with significant volumes to sell, forcing them to offer at much lower prices. Production continues to operate near maximum capacity, ensuring good availability throughout Europe and potentially more competitive offers in coming weeks.

Most buyers indicate they have already covered the majority of their Q3 volumes and show limited interest in additional purchases for either spot delivery or Q3 requirements.

Gouda and mozzarella face similar pressures

Gouda prices have declined to €4,050 ($4,685/mt) EXW, with trading activity remaining low as expected for this time of year. Several spot deals at lower prices are contributing to market weakness, though traded volumes remain relatively limited.

Stock pressure is building unevenly across producers, with some managing to keep inventory “young” while others struggle with older volumes. European milk production remains relatively high with particularly high fat content, providing ample supply for cheese production.

Mozzarella prices have decreased to €4,000 ($4,627/mt) EXW in Europe, while US mozzarella trades at €3,487 ($4,034/mt) EXW. European markets remain quiet during the summer period, with stock pressure affecting some but not all producers.

US mozzarella production increased 3.27% year-on-year in June, confirming that production capacity growth is improving US mozzarella availability and global competitiveness.


For a more comprehensive cheese market outlook, visit our market analysis page: https://app.vespertool.com/market-analysis/2163