Dairy product prices decline for second auction in 2016
The GDT average winning price fell 1.4% to $US2,405.
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See also: Doubt cast over Fonterra's forecast payout
Dairy product prices fell in the latest GlobalDairyTrade auction, declining for the second time this year, amid expectations that worldwide supply will outstrip demand.
The GDT average winning price fell 1.4% to $US2405, down from $US2458 at the previous auction two weeks ago. Some 21,930 tonnes of product was sold, down from 25,671 tonnes at the previous auction two weeks ago.
The AgriHQ 2015-16 Farmgate Milk Price fell 17c to $4.43 per kilogram milksolids after the GDT auction. This compares to Fonterra's current 2015-16 milk price forecast of $4.60/kgMS.
"The weak GDT results, while disappointing, were aligned with market expectations," AgriHQ dairy analyst Susan Kilsby said in a note. "Global demand for dairy commodities continues to be weak relative to global milk supply."
Rennet casein fell 7.8% to $US4,405 a tonne, while butter dropped 5.9% to $US3162 a tonne. Cheddar shed 3.4% to $US2,867 a tonne, and skim milk powder retreated 3.2% to $US1,835 a tonne.
Lactose declined 1.7% to $US579 a tonne, while whole milk powder slipped 0.5% to $US2188 a tonne.
The NZX Dairy Futures market had anticipated a reduction in both whole milk powder and skim milk powder prices from those achieved at the previous GDT event, Kilsby noted.
Butter milk powder rose 2.7% to $US1620 a tonne, and anhydrous milk fat gained 2.4% to $US3724 a tonne.
The New Zealand dollar last traded at 64.86USc at about 11.30am in New York, compared with 64.52USc at 5pm in Wellington the previous day.
There were 115 winning bidders out of 156 participating bidders at the 11-round auction. The number of qualified bidders was 616, the same as at the last auction.
(BusinessDesk)
Margreet Dietz
Wed, 20 Jan 2016
Wed, 20 Jan 2016
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Dairy product prices decline for second auction in 2016
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