WMP exports were high in both April and May with 50,000t exported in each month compared to an average 30,000t a month in the first three months of 2008. For other products, exports from January to May 2008 were below last year. SMP exports were marginally down, while whey powder exports were 13% below 2007 levels. Butter and butteroil exports continued to be low, down by 55% in the first five months of 2008 compared to 2007. There was no sign of any recovery in cheese exports, down 7% on 2007. Comparisons with the first half of 2007 should be treated with some caution: some market commentators think that the prospect of subsidies for butter and cheese exports vanishing probably boosted exports in the early summer of 2007.

WMP exports were 8% up in the first five months of 2008, helped by the increase in exports in April and May. Most of the increase was due to higher exports from the UK with 24,000t exported in the first five months of 2008 compared to 9,000t over the same period last year. EU WMP exports had been falling since 2006 due to the expansion of output in New Zealand. However, drought has reduced the availability of New Zealand WMP in 2008, while a big Algerian contract has boosted exports in recent months.

SMP exports recovered in 2008 as internal EU market prices became competitive on the world market, but the current level of SMP exports is below the level seen during the summer of 2007. The summer of 2007 saw SMP exports accelerate from March 2007 and then in June, July and August 80,000t of SMP were exported unsubsidised to world market buyers.

In the first five months of 2008, on average 10,000t of EU butter/butteroil was exported each month compared to an average of 23,000t a month in the same period of 2007. With the setting of export refunds at zero in June 2007, EU exporters became much less competitive on world markets for both bulk butter and butteroil, as internal EU prices were above world market levels.

Cheese exports in the first four months of 2008 were lower than 2007 levels, but there was some recovery in May with 48,000t exported. However, exports grew rapidly in the first half of 2007, mainly due to growth in the Russian market, this was maintained at around 50,000t exported a month in the second half of 2007, despite refunds being set at zero on 14 June 2007.

Condensed milk exports in the first five months of 2008 were 8% down on the previous year. There have been no export subsidies for condensed milk since January 2007. Whey powder exports, which have never been subsidised, were 13% down in 2008 compared to 2007.

Only 26,000t of butter were imported into the EU in the first five months of 2008 compared to 37,000t last year, due to lower imports from New Zealand. Cheese imports continued to grow in May and were 6% higher for the first five months of 2008 compared to 2007.

World Dairy Exports	1996		2007		Change
	000 t	EU15 Share	000 t	EU27 Share	%
Butter/butteroil	791	24%	850	24%	+7%
SMP	956	24%	1,100	18%	+15%
WMP	1,154	47%	1,850	20%	+60%
Cheese	1,140	45%	1,600	37%	+40%

Source: ZMP, DIN est.

EU27 dairy product exports ('000t)	EU27				EU27	v. 2007
	Jan-Dec				Jan-May
	2006	2007	Change		2008	Change
SMP	84	196	+133%		78	-2%
Whey Powder	321	363	+13%		138	-13%
Cheese	587	594	+1%		223	-7%
WMP	433	361	-17%		194	+8%
Butter/butteroil	239	203	-15%		52	-55%
Condensed Milk	211	227	+8%		93	-8%

Source: Eurostat

EU WTO SUBSIDISED CEILINGS	Base Year	1995/6	2001/2**
	000 t
Butter/oil	506	488	399
SMP	345	335	273
Cheese	407	426	321
Other (inc WMP)	1,213	1,185	958

** And for subsequent years
Source: European Commission