The Global Dairy Trade has fallen for the sixth consecutive time, down 4.3%.
The latest auction comes on the back of a 2.2% drop two weeks ago and it is the sixth consecutive drop in prices. The last time the Global Dairy Trade returned a positive was on March 3.
The main drops were in butter (-10%), milk fat (-7.4%), butter milk powder (-7.0%) and lactose (-6.9%).
Just last week, Fonterra reduced its forecast Farmgate Milk Price for the 2014/15 season to $4.40 per kgMS.
Chairman John Wilson said the revised forecast reflected the reality that global commodity prices had not increased as expected.
“World markets are over-supplied with dairy commodities after dairy farmers globally increased production in response to the very good prices paid 12-18 months ago. This supply imbalance has heightened due to continuing good growing conditions in most dairy producing regions.
Along with its previously announced forecast dividend range of 20-30 cents per share, the change amounts to a forecast Cash Payout of $4.60 – $4.70 that would be paid to a fully shared-up farmer.
Wilson went on to say that it is “tough season and we will continue to keep our farmers informed as the season draws to a close given the current volatility”.