Friday, March 29, 2024

GDT gains 1.4% – Event 126, October 15

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Prices gained 1.4% at the October 15 GlobalDairyTrade auction, buoyed by increases in whole milk powder (WMP), anhydrous milkfat (AMF) and butter prices. On the decline this auction was skim milk powder (SMP), cheddar cheese, butter milk powder and casein.
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Source: GDT

The auction sold 50,816 tonnes of product to 132 winning bidders. 

WMP prices made the biggest gains in Contract 5 (+3.9%) and C3 (+3.5%), for shipment in March and January respectively. All other contracts also improved in price. The WMP forward price curve is sloping upwards, from an average of US$2470/t in C2 to US$2783/t in C6.

The latest result means that the WMP October futures contract on the NZX Dairy Futures Market will settle at US$2420/t, the average of Fonterra's C2 Regular WMP prices across both auctions this month. Prior to this auction, futures prices settled at US$2460/t, and prior to the October 1 auction, futures prices settled at US$2890/t.

SMP prices declined most in C2 (-4.3%) and C3 (-3.4%). The SMP forward price curve is sloping upwards, from an average of US$2423/t in C2 to US$2663/t in C6.

Prices of European SMP from Arla and Euroserum traded US$10 – 25/t above equivalent product from Fonterra. At the previous auction, Fonterra product commanded a US$65 – 85/t premium over Arla and Euroserum. The reversal is due to Fonterra's C2 medium heat SMP declining 4.8% this auction while Arla's fell 0.4% and Euroserum was lower by 1.8%.

The SMP October futures contract will settle at US$2450/t. Prior to both auctions this month, futures prices settled at US$2600/t.

AMF prices gained strongly in C2 (+11.9%), and improved in all other contracts by between 3.0 – 4.9%. The AMF forward price curve is upward sloping, from an average of US$3324/t in C2 to US$3461/t in C6. The AMF October futures contract will settle at US$3098/t.

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