Dairy product prices inch up, whole milk powder slips
Dairy product prices rose at the Global Dairy Trade auction, though gains fell short of expectations as whole milk powder prices unexpectedly moved lower (scroll down for charts).
The GDT price index rose 1.7 percent to US$2,975, up from US$2,920 at the previous auction two weeks ago. Some 35,086 tonnes of product was sold, down from 36,748 tonnes at the previous auction.
Whole milk powder slipped 0.2 percent to US$2,782 a tonne. Futures traders had anticipated an increase of more than 11 percent, AgriHQ dairy analyst Amy Van Ossenbruggen said in a note before the auction.
"Volumes of whole milk powder on offer are as forecast at this event, at 19,250 tonnes; however, forecast volumes over the coming months have decreased from earlier forecasts," according to Van Ossenbruggen.
On Tuesday, Dairy Crest Group, a UK milk processor, said it expects an increase in milk prices to hurt butter volumes and margins in the second half of the year. The company said it had increased the milk price it pays to farmers by 12 percent.
At the latest GDT auction, butter milk powder jumped 7 percent to US$2,276 a tonne, while anhydrous milk fat climbed 4.6 percent to US$4,998 a tonne.
Lactose rose 3.7 percent to US$815 a tonne, butter increased 3.6 percent to US$3,892 a tonne, while skim milk powder added 3 percent to US$2,293 a tonne.
Cheddar advanced 2.2 percent to US$3,518 a tonne, and rennet casein gained 2 percent to US$6,893 a tonne.
The New Zealand dollar last traded at 73.22 US cents at about 11.59am in New York, compared with 72.93 US cents at 5pm in Wellington the previous day.
There were 129 winning bidders out of 175 participating at the 13-round auction. The number of qualified bidders rose to 616, up from 613 at the previous auction.
Source: GlobalDairyTrade. Click to zoom.