Butter and whole milk powder gain sharply, while SMP, whey and major cheeses decline
European dairy commodity markets showed widely divergent price movements in the latest European Commission Milk Market Observatory report, with butter and whole milk powder (WMP) recording strong year-on-year gains while skimmed milk powder (SMP), whey powder and several major cheese categories declined.
The European Commission published its weekly dairy commodity report on August 27, 2026, covering market developments through August 23. The figures, updated on August 26, provide benchmark prices for key dairy commodities across the European Union.
Butter Prices Rise 21% Year on Year
Butter was among the strongest-performing commodities in the latest report. The EU average price reached €404 per 100 kilograms, equivalent to €4,040 per tonne.
The price represents a 21% increase compared with the same period last year, highlighting stronger market conditions for butter despite declines in several other dairy commodities.
The contrasting performance across dairy products suggests that market conditions are being influenced differently across individual product categories.
WMP Records Sharpest Annual Increase
Whole milk powder posted the most significant year-on-year increase among the commodities covered.
The EU average WMP price reached €356 per 100 kilograms, or €3,560 per tonne, representing a remarkable 70% increase from the previous year.
The strong rise in WMP contrasts sharply with the performance of SMP, demonstrating the significant divergence between whole and skimmed milk powder markets.
EU Dairy Commodity Price Snapshot
| Dairy commodity | EU average price | Year-on-year change |
|---|---|---|
| Butter | €404/100 kg | +21% |
| Whole milk powder | €356/100 kg | +70% |
| Skimmed milk powder | €291/100 kg | -43% |
| Whey powder | €167/100 kg | -16% |
| Cheddar | €335/100 kg | -26% |
| Emmental | €548/100 kg | -15% |
| Gouda | €382/100 kg | -22% |
| Edam | €375/100 kg | Not specified |
SMP Moves in the Opposite Direction
While WMP prices surged, skimmed milk powder experienced a substantial decline.
SMP averaged €291 per 100 kilograms, equivalent to €2,910 per tonne, which was 43% lower than the corresponding level a year earlier.
The substantial gap between WMP and SMP price movements is one of the most notable features of the latest European dairy market data. For processors, the changing relative values of milk powder products can influence product allocation and processing decisions.
Whey and Cheese Prices Also Decline
Whey powder prices also weakened during the period. The EU average stood at €167 per 100 kilograms, down 16% year on year.
Several major cheese categories recorded annual declines as well.
Cheddar averaged €335 per 100 kilograms, representing a 26% decrease from the previous year. Emmental was priced at €548 per 100 kilograms, down 15%, while Gouda reached €382 per 100 kilograms, a 22% decline.
Edam recorded an average price of €375 per 100 kilograms, although the report did not specify its year-on-year change.
Diverging Market Signals
The latest figures present a mixed picture for the European dairy industry. Strong growth in butter and WMP prices contrasts with significant declines in SMP, whey and several cheese products.
For dairy producers and processors, such divergence can affect the economics of milk utilisation. Higher prices for particular commodities can create incentives to direct more milk solids toward those products, while weaker categories may place pressure on processor margins.
The data also provides an important market signal for traders and dairy businesses monitoring European commodity markets. Changes in commodity prices can influence farmgate milk prices, processing strategies, export competitiveness and purchasing decisions.
Market Monitoring Remains Critical
The European Commission’s Milk Market Observatory provides regular benchmark data that allows dairy industry participants to track commodity price developments across the EU.
The latest report shows that there is no single direction for the European dairy market. Instead, individual commodities are experiencing significantly different market conditions.
With butter and WMP showing strong annual gains while SMP, whey and several cheeses remain under pressure, producers and processors will need to closely monitor demand, supply and international market developments as the year progresses.
For the European dairy sector, the key takeaway is clear: commodity performance is increasingly differentiated, making product mix and market positioning important factors for maintaining profitability.
