The recent increase in Gouda prices has stirred inquiries regarding its sustainability. According to the Vesper Price Index as of November 15, 2023, Gouda has increased to €4150 | $4514/mt ($2.05/lb) EXW.

Figure 1: Vesper Price Index for EU cheeses in EUR/mt

While there was indeed support for most cheese prices due to limited supply, the substantial increase in Gouda prices has led to the perception that sentiment played a significant role.

Presently, as prices continue their gradual climb, the disparities between Q4 and Q1 are widening. Observing the current price movement of all cheeses, it appears that the current price level of Gouda is here to stay.

Specifically, Cheddar prices are on the rise due to diminishing supplies, and Emmental and Mozzarella are trailing Gouda’s price from a distance. According to this week’s Vesper Price Index for Europe (15/11/2023), Cheddar increased to €4000 | $4351/mt ($1.97/lb) EXW, Emmental to €4200 | $4569/mt ($2.07/lb) EXW, and Mozzarella to €3650 | $3970/mt ($1.8/lb) EXW.

Looking ahead, a more diverse set of factors comes into play. The combination of lower milk availability and higher milk prices is poised to drive cheese prices higher, primarily from the supply side.

However, from the demand side, Q1 doesn’t typically witness robust cheese consumption, and the current price level for Gouda may be beyond the demand threshold for this period. Disagreements persist around the Q1 price level, with suppliers targeting around €4200/mt due to lower supply and high milk prices, while buyers are hesitant to go beyond €4000/mt. Buyers are skeptic about the €4200 level, and are more confident in the €4000 level seen in the futures market.

The price outlook for the final months of the year is laden with upward potential, given the scarcity in case buyers still require volumes. Concerning Q1 pricing, there seems to be some downward potential due to doubts about the current price level stemming from lower demand. Nevertheless, when considering the production side, the arguments lean toward a bullish outlook.

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