For the Quarter Ending September 2025
North America
• In the United States, the Anhydrous Milkfat Price Index remained stable quarter-over-quarter in Q3 2025, influenced by mixed market signals.
• Production costs rose from a 2.6% year-over-year PPI increase in August 2025 and spiked natural gas prices.
• General inflation, with CPI at 3.0% year-over-year in September 2025, also contributed to higher operational costs.
• Milk feedstock costs softened in Q3 2025 due to increased supplies and low dairy farmer feed costs.
• Demand was supported by a 5.42% year-over-year retail sales rise in September 2025 and 4.3% unemployment.
• Consumer confidence declined to 94.2 in September 2025, suggesting weaker discretionary food product demand.
• Industrial production showed marginal 0.1% year-over-year growth in September 2025, indicating slow manufacturing activity.
• U.S. milk production surged throughout Q3 2025, expanding dairy product inventories globally and domestically.
Why did the price of Anhydrous Milkfat change in September 2025 in North America?
• Rising producer input costs, like a 2.6% PPI increase in August 2025, pressured Anhydrous Milkfat prices.
• Softening milk feedstock costs and surging U.S. milk production in Q3 2025 provided downward price pressure.
• Robust retail sales, up 5.42% year-over-year in September 2025, supported demand, counteracting price declines.
APAC
• In China, the Anhydrous Milkfat Price Index remained stable quarter-over-quarter in Q3 2025, influenced by mixed macroeconomic signals.
• Production costs for Anhydrous Milkfat declined in Q3 2025, driven by lower farmgate milk prices and stable dairy feed costs.
• Demand outlook for Anhydrous Milkfat remained strong, supported by robust B2B demand and premium dairy product preferences.
• The Anhydrous Milkfat price forecast suggests continued stability, balancing strong demand against declining production costs.
• The price index was influenced by a 0.1% CPI increase and a 2.5% PPI decline in September 2025.
• Industrial production expanded 6.5% in September 2025, indicating stronger demand for Anhydrous Milkfat in the food sector.
• Retail sales increased 4.5% in September 2025, boosting consumer spending on Anhydrous Milkfat-containing food products.
• Domestic raw milk production declined in Q3 2025, while global milk supply was projected to increase in H2 2025.
Why did the price of Anhydrous Milkfat change in September 2025 in APAC?
• Declining production costs, including lower farmgate milk prices, exerted downward price pressure.
• Robust consumer demand, with 4.5% retail sales growth in September 2025, supported Anhydrous Milkfat prices.
• Strong industrial production, up 6.5% in September 2025, indicated increased demand from food processing.
Europe
• In Germany, the Anhydrous Milkfat Price Index rose quarter-over-quarter in Q3 2025, influenced by increasing farm gate milk prices.
• Anhydrous Milkfat production costs increased in Q3 2025, driven by rising EU farm gate milk prices in August and September 2025.
• Elevated energy costs for food processing in Q3 2025, despite a 1.7% PPI decrease in September, contributed to higher expenses.
• Demand for Anhydrous Milkfat strengthened in bakery and confectionery sectors during Q3 2025, favoring natural fats.
• Overall Anhydrous Milkfat demand faced headwinds from a contracting Manufacturing Index in Q3 2025.
• Industrial production declined by 1.0% in September 2025, negatively impacting Anhydrous Milkfat demand from industrial users.
• The Consumer Price Index increased by 2.4% in September 2025, indicating general inflation impacting consumer purchasing power.
• German milk collection declined from January to July 2025, impacting raw material availability for Anhydrous Milkfat production.
Why did the price of Anhydrous Milkfat change in September 2025 in Europe?
• Rising EU farm gate milk prices in August and September 2025 increased Anhydrous Milkfat production costs.
• Elevated energy costs for food processing in Q3 2025 further pressured Anhydrous Milkfat manufacturing expenses.
• The Consumer Price Index increased by 2.4% in September 2025, suggesting broader inflationary pressures on inputs.
