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WESTERN EUROPE: During the past two weeks, spring has finally arrived in many European countries, weather wise. Warmer temperatures and rainfall are two factors contributing to more favourable early spring conditions than in past weeks. Pastures are greening and cows are once again grazing, causing milk output to gain momentum. More dairy plant managers are reporting growing milk volumes from one week to the next. Production schedules are also on the increase at most locations. International sales activity continues to be reported as slow and unaggressive. A firm Euro against the U.S. dollar is adding to sales frustrations by producers and handlers. At this time, with the Euro gaining strength on the dollar from one day to the next, traders and exporters are finding it very difficult to price and finalize any buyer interest. Some producers and handlers are lobbying the EU Management Committee to increase export refunds in hopes of helping stimulate buyer interest. The next management meeting will be May 15, but traders and handlers state that they do not necessarily have to wait for the meeting to announce an adjustment. As milk production increases, thus is production of manufactured dairy products. In many instances, due to a lack of international sales and a domestic market that is not keeping pace with output, new stocks are clearing to inventory. Producers of skim milk powder are reporting that more are preparing powder for intervention offering. Although this clearance is heavier than many anticipated earlier this spring, total volumes are still expected to not breach the 109,000 MT level during the open season.

EASTERN EUROPE: Milk production in Eastern Europe is starting to show more positive signs of seasonal increases than in past weeks. Weather conditions in this region of Europe are also becoming more conducive to steady production growth. Stocks of manufactured dairy products are low, although as milk output increases, thus will production schedules and stocks. No significant new buyer interest is being reported from this region

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