Prices fall at final Global Dairy Trade of 2016

The final Global Dairy Trade auction of 2016 closed out the year with overall dairy product prices down 0.5%.

The decrease follows four positive Global Dairy Trade auctions over the past two months.

At today’s auction, whole milk powder (WMP) prices were down 0.8%. This drop in price was anticipated, with the NZ futures market suggesting that WMP prices would be down in the region of 2%.

Skimmed milk powder (SMP) prices remained unchanged at this auction, while butter prices were up 0.5%.

Anhydrous milk fat (AMF) prices were down 2.3% and lactose (LAC) pries fell 1.6% at the today’s Global Dairy Trade event.

Global Dairy Trade – Key Results

  • AMF index down 2.3%, average price US$5,367/MT
  • Butter index up 0.5%, average price US$4,290/MT
  • BMP index up 3.1%, average price US$2,874/MT
  • Ched index up 1.9%, average price US$3,826/MT
  • LAC index down 1.6%, average price US$857/MT
  • RenCas index up 3.3%, average price US$6,473/MT
  • SMP index unchanged, average price US$2,621/MT
  • WMP index down 0.8%, average price US$3,568/MT

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Meanwhile, this week saw 40t of skimmed milk powder (SMP) sold from the European Union’s intervention stocks.

Of the 22,000t of SMP that was released onto the market to be sold, just 40t was acquired. Germany (20t) and the UK (20t) were the only two buyers.

The European Commission only selected bids that met a minimum selling price of €2,151/t, a level above average market prices, which for November were €2,000/t.

Over 350,000t of SMP remains in public storage and the European Commission has opened the second tender, re-offering the product that was unsold from the first tender.

According to the regulations, tenders will take place on the first and third Tuesday in the month. The deadline for the second tender is January 3, 2017.

Following a steady slow down, figures from the EU Milk Market Observatory (MMO) show that no more quantities of SMP have been put into public intervention since September 2016, even though this market measure remains open.