Fonterra has forecast $5.30/kg MS.
And the AgriHQ Snapshot farmgate milk price indicates if the latest GDT prices were achieved across the season farmers would get $3.90/kg MS.
AgriHQ dairy analyst Susan Kilsby said “The volume of whole milk powder being offered on GDT is at its seasonal peak and buyer demand is simply not strong enough at present to clear the large volumes without prices being impacted.
“Stocks of dairy products are building across the globe due to Russia’s current ban on importing dairy products from many western nations and a lack of urgency from Chinese buyers while at the same time global milk supplies are expanding.
“A farmgate milk price of $5.05/kg MS means that most farms will be barely covering costs of production meaning there will be virtually no cash available for debt repayments or discretionary spending such as upgrading plant or equipment,” Kilsby said.
The average winning price at last night’s auction was US $2599 a tonne. There were 55,057 tonnes sold to 145 winning bidders from the 167 bidders taking part.
The price on anhydrous milk fat was down 5% to $3117 a tonne, butter -6% at $2514, butter milk powder -11.3% at $2723, cheddar -1.2% at $3028, rennet casein -1.4% at $8224, skim milk powder -2.7% at $2540, sweet whey powder -9.3% at $1175 and whole milk power -10% at $2443.
Whole milk powder makes up more than half of the volume of products sold on the GDT auctions.
