The cheese markets are running a little dry at the moment. Finding active buyers and sellers for most cheese varieties has become challenging, as most business is done until the end of the year. In contrast, Gouda stands apart and feels very tight on the spot market. Producers have no stock pressure and are mostly focused on the milk collection, which is crumbling, and most of the biggest buyers have already locked in Q4 long before.

However, a few buyers have had to purchase Gouda at elevated prices which in Europe are going as high as €3850 for last-minute deliveries for October. The age of the delivered Gouda is noted to be very young, and the demand for October seems to be higher than the supply throughout Europe. Latest Dutch milk production numbers show a strong -1.2% YoY decrease in Sept, which has contributed to the tight sentiment surrounding the EU spot market for Gouda.

Prices for futures hover around the level of €3650 for Q1, which fuels buyers to think that prices could make a small step down towards the start of next year. The majority however is still uncertain regarding the price movement and is therefore hesitant to lock in anything. 

Gouda feels overpriced compared to other cheeses, particularly compared to Cheddar. As foreseen, Cheddar prices throughout the EU have dipped below the price for Gouda. Even though Cheddar prices appear to have regained stability following a decrease resulting from the clearance of stocks at lower rates, the latest Vesper Price Index for this week reveals that the EU price for Cheddar has now dipped below that of Gouda. The Vesper Price Index (18/10/2023) for Cheddar EU is set at €3750 | $3966/mt ($1.8/lb) EXW (see Figure 1).

Price Comparison between the European price of Gouda EU and Cheddar
Figure 1: Price comparison between the European price of Gouda EU and Cheddar (Curd)

Outlook for Gouda
The spot market for Gouda is expected to stay very tight throughout the final months of the year, possibly extending into the start of the new year as well. Just before the start new year, however, some expect that prices could take a small step back after the long run up. Keeping the futures prices, the milk collection and the developments in the global dairy & cheese markets in mind, we are only expecting a small step, if any.

Outlook for Cheddar
The outlook for Cheddar is a little more positive in Europe and the US now that most of the burdensome stocks have been cleared and the milk season will only lower the availability of Cheddar. No big jumps are expected in the final months of the year, but there is some potential for prices to move up. In Oceania, the direction for Q1 is clearly up, but it’s a bit uncertain if the market is already strong enough to prevent another decrease on the next GDT event. Let’s see! 

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