In the Australian market, Fonterra’s milk collection numbers for the 2013-2014 season have reached the same level as recorded in the previous season. Collections were down for the first half of the season, however finished strongly with the collection for Fonterra in Australia being up 16%, when compared with June 2013.
The futures market continues to look cheap. In saying this, given the collapse in powder prices and the additional volume now offered over the next few months of GDT, it doesn’t surprise that we are seeing a lack of buying interest in the futures market. We still maintain a view that WMP is a buy at these levels, with risk asymmetric and skewed to the upside. This market will bounce as inventory levels clear on the ground in our export markets.