Cheddar supplies in the UK market are tight, forcing higher prices that will continue to rise. In the mild sector, prices have increased by at least £200/tonne since August. The problem began in the first three months of the year, when milk output was depressed in the Irish Republic and in the UK. This left cheesemakers with reduced throughput in a period when stocks normally build. A combination of low farmgate milk prices and poor weather in the UK then left milk output below seasonal levels through the summer. The result is that cheese making has now been below normal levels for over nine months. Another factor in rising prices has been the upward trend of world and EU prices for butter and skimmed milk powder. This has made it more attractive to divert milk into these products rather than into low-priced Cheddar. In the first half of this year, cheese output in the UK was down by more than 10%. In the same period, imports of Cheddar from Ireland, the most important overseas source, were down by 16% and total Cheddar imports tumbled by 26%. Traditional shippers from the continental Europe have not been interested in the UK market, as their own cheese markets were showing higher returns. It is estimated that Cheddar stocks are at least 20,000 tonnes lower than a year ago in an annual market of 300,000 tonnes. {{PROVISIONS }}

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