1 mins to read

Dairy product prices eke out surprise gain

GlobalDairyTrade aucition bucks expectations.

Margaret Dietz
Wed, 08 Feb 2017

Dairy product prices eked out a gain at the Global Dairy Trade auction, bucking expectations for a decline, as both whole and skim milk powder rose.

The GDT price index rose 1.3% to $US3537, up from $US3,517 at the previous auction three weeks ago. Some 21,273 tonnes of product was sold, below the 22,030 tonnes at the previous auction.

Whole milk powder rose 1% to $US3314 a tonne.

"Milk powder prices exceeded market expectations," AgriHQ dairy analyst Susan Kilsby said in a note.

Regular grade New Zealand-sourced whole milk powder supplied by Fonterra with an April delivery date was priced at $US3290 per tonne, $US90 above the price which the February WMP futures contract closed at on Tuesday, Ms Kilsby noted.

At the latest GDT auction, lactose jumped 12.4% to $US910 a tonne, while butter climbed 4.9% to $US4593 a tonne.

Anhydrous milk fat gained 4% to $US5765 a tonne, while skim milk powder inched 0.1% higher to $US2608 a tonne.

Demand for skim milk powder was considerably better than the 6% price fall anticipated by the NZX Dairy Derivatives market, Ms Kilsby said.

Butter milk powder dropped 7.5% to $US2254 a tonne, while cheddar fell 3.7% to $US3798 a tonne, and rennet casein eased 0.4% to $US6445 a tonne.

The New Zealand dollar last traded at 73.15USc at about noon in New York, compared with 73.21USc at 5pm in Wellington the previous day.

There were 104 winning bidders out of 172 participating at the 12-round auction. The number of qualified bidders rose to 530, up from 526 at the previous auction.



Margaret Dietz
Wed, 08 Feb 2017
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
Dairy product prices eke out surprise gain