The latest Global Dairy Trade auction posted a 2.1% rise in dairy product price, in its most recent auction.
It comes after the last auction, a fortnight ago, posted a loss of 2.9%.
At this week’s auction, the main movers included anhydrous milk fat and cheddar, while skim milk powder and whole milk powder were only marginally up, up 0.1% and 1.5% respectively.
Global Dairy Trade – Key Results
- AMF index up 6.7%, average price US$3,203/MT
- Butter index down 2.0%, average price US$2,702/MT
- BMP index down 8.2%, average price US$1,395/MT
- Ched index 10.5%, average price US$2,778/MT
- LAC index 6.2%, average price US$661/MT
- RenCas index 11.8%, average price US$4,438/MT
- SMP index 0.1%, average price US$1,721/MT
- WMP index 1.5%, average price US$2,013/MT
WMP index up 1.5%, average price US$2,013/MT
Meanwhile, Fonterra has said that it expects dairy prices to pick up at the end of the year as it posted interim results with a forecasted milk price of $3.90/kgMS(€2.30/kgMS).
The $3.90/kgMS is the equivalent of 18c/L.
Chairman John Wilson said that the supply and demand imbalance in the globally traded dairy market has brought prices down to unsustainable levels for farmers around the world, and particularly in New Zealand.
Fonterra’s Chief Executive Theo Spierings, said that current global economic conditions remain challenging and are impacting dairy demand and prices.
“The balance between available dairy exports and imports has been unfavourable for 18 months following European production increasing more than expected and lower imports into China and Russia.
“This imbalance is likely to continue in the short term, with prices expected to lift later this calendar year.”
The long-term fundamentals for global dairy, he said, are positive with demand expected to increase by 2-3% a year due to the growing world population, increasing middle classes in Asia, urbanisation and favourable demographics.