Dairy prices have remained steady in the latest Global Dairy Trade auction – with no change across the board, following three consecutive increases. Whole milk powder prices did however record a slight dip, while prices for the other commodity groups all increased, including Fonterra’s second biggest “reference” product – skim milk powder – which gained 0.5 per cent Lets look at the details:
- A rise for for Anhydrous milk fat 0.4% to $US5,984per metric tonne
- Butter – up 0.4% per cent $US4,878
- Butter mIlk up 9.7% $3,688 possibly because there was not much on offer
- Cheddar up 0.7% to $US 4,297
- Lactose up 0.4% at $1,188
- Skim Milk Powder up by 0.5% to $US3,315
- Whole Milk Powder dow 0.4% to $US 3,749 per m/t still sitting 23 per cent higher than at the same time last year.
The NZX dairy Analyst Stuart Davison was a bit surprised at the result but says a zero result is not the worst outcome possible, and in fact it could have been worse. Stuart Davison says Total volumes sold were on the lower end of the scale, with South East Asia dominant being top buyers on every product, except butter. Meanwhile Westpac has upgraded its 2021/22 farmgate milk price forecast by 75 cents to $8.50/kg. Analyst Nathan Penny says the key catalyst for the revision is the downgrade their production forecast for the season. Westpac is expecting production to fall this season, and with weak global supply underpinning high global dairy prices for at least the rest of the year. Fonterra has forecast a record opening milk price for farmers this season and expects to pay farmers a mid-point of $8 per kgMS.