Market outlook | h2 2026
EU milk supply is strong. Know what that means for your H2 costs.
European raw milk production carried strong momentum through 2025 and into 2026, with the seasonal flush expected to deliver significant volumes through Q1 and Q2.
But composition matters as much as volume: milk fat and protein levels in key producing countries are running significantly above historical averages, pushing effective output of butter, cheese, and powders higher than raw production figures suggest.
This report covers 13 European dairy categories from raw milk through powders, cheeses, and energy.
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"Even at similar fluid milk volumes, the actual output of butter, cheese, and powder products is higher than raw production numbers might suggest. Compositional strength adds to the supply pressure facing dairy product markets."
Jasper Endlich
Dairy Analyst, Vesper
More supply than the headline suggests
The Netherlands and Ireland are showing very strong milk composition this season, with fat and protein content running significantly higher year-on-year. Liquid prices are already very low before the flush kicks in.
For dairy buyers planning H2 purchases, understanding where that supply pressure lands, and which categories feel it most, is the starting point for any negotiation.
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